6820 LBJ Freeway Dallas, Texas 75240 (972

6820 LBJ Freeway
Dallas, Texas 75240
(972) 980-9917
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held November 8, 2012
September 18, 2012
Dear Shareholder:
We invite you to attend the annual meeting of shareholders of Brinker International, Inc. to be held
at 9:00 a.m. (CST), on Thursday, November 8, 2012, at the Brinker International, Inc. principal executive office
campus, in the building located at 6700 LBJ Freeway, Dallas, Texas 75240. At the meeting, we will: (1) elect
eight (8) directors for one-year terms; (2) vote on the ratification of the appointment of KPMG LLP as our
independent auditors for the fiscal 2013 year; (3) cast an advisory vote on executive compensation; and
(4) conduct any other business properly brought before the meeting.
Your Board of Directors has chosen September 10, 2012 as the date used to determine the shareholders who
will be able to attend and vote at the annual meeting. If you owned shares in Brinker, at the end of business on
that day, you are invited to attend the annual meeting. Seating at the meeting will be limited to Brinker’s
shareholders, proxy holders and invited guests of Brinker. If you own your shares in your own name, please bring
photo identification to the meeting. If you hold your shares through a bank, broker or other third party, please
bring photo identification and a current statement from that party showing your ownership. Please note that
cameras, recording equipment and other electronic devices will not be permitted at the meeting.
Your vote is important. Whether or not you plan to be present at the meeting, please take time to vote. If
you decide not to attend the annual meeting, you may vote on these proposals by proxy. To do so, please cast
your vote, as instructed in the Notice of Internet Availability of Proxy Materials you received, over the Internet
or by telephone after your review of proxy materials at www.proxyvote.com (by using your 12-digit control
number on the Notice of Internet Availability of Proxy Materials to access the website) or, upon your request,
after receipt of hard copies of proxy materials. We ask that you cast your vote as promptly as possible. You may
also request a paper copy of the proxy card to submit your vote, if you prefer. We do encourage you to vote by
Internet. It is convenient and saves postage and processing costs. If you have voted by the Internet, by mail or by
telephone and later decide to attend the annual meeting, you may come to the meeting and vote in person.
We look forward to seeing you at the meeting.
Very truly yours,
Douglas H. Brooks
Chairman of the Board, President
and Chief Executive Officer
BRINKER INTERNATIONAL, INC.
PROXY STATEMENT
QUESTIONS AND ANSWERS ABOUT THE MEETING AND VOTING
Why did you send this Proxy Statement to me?
The Board of Directors of Brinker International, Inc. (sometimes referred to here as “Brinker,” “we,” “us,”
“our,” or the “Company”) is soliciting the enclosed proxy to be used at the annual meeting of shareholders on
November 8, 2012 at 9:00 a.m. (CST), and at any adjournment or postponement of that meeting. The meeting
will be held at our principal executive office campus, in the building located at 6700 LBJ Freeway, Dallas, Texas
75240. The purpose of the meeting is to:
• elect eight (8) directors;
• vote on the ratification of the selection of KPMG LLP as our independent auditors for the 2013 Fiscal
Year;
• cast an advisory vote on executive compensation; and
• conduct any other business properly brought before the meeting or any adjournment or postponement
thereof.
We posted this Proxy Statement and the accompanying proxy on or about September 18, 2012, to our
website at www.proxyvote.com, and mailed notice on September 18, 2012 to all shareholders entitled to vote at
the annual meeting.
Why am I being asked to review materials on-line?
Under rules adopted by the U.S. Securities and Exchange Commission (“SEC”), we are furnishing proxy
materials to our shareholders on the Internet, rather than mailing printed copies of those materials to each
shareholder. If you receive a Notice of Internet Availability of Proxy Materials by mail, you will not receive a
printed copy of the proxy materials unless you request one. Instead, the Notice of Internet Availability of Proxy
Materials will instruct you as to how you may access and review the proxy materials on the Internet. If you
received a Notice of Internet Availability of Proxy Materials by mail and would like to receive a printed copy of
our proxy materials, please follow the instructions included in the Notice of Internet Availability of Proxy
Materials. We anticipate that the Notice of Internet Availability of Proxy Materials will be mailed to shareholders
on or about September 18, 2012.
How many votes do I have?
If we had your name on record as owning stock in Brinker International, Inc. at the close of business on
September 10, 2012, then you are entitled to vote at the annual meeting. You are entitled to one vote for each
share of Brinker’s common stock you own as of that date. At the close of business on August 13, 2012,
73,925,390 shares of the Company’s common stock were outstanding and eligible to vote.
How do I vote by proxy?
Whether you plan to attend the annual meeting or not, we encourage you to follow the instructions on the
Notice of Internet Availability of Proxy Materials. You may vote
• via Internet at www.proxyvote.com by using your 12-digit control number to access the site (you may find
this number on your Notice of Internet Availability of Proxy Materials);
• by phone; and
• by requesting, completing and mailing a paper proxy card, as outlined in the Notice of Internet
Availability of Proxy Materials.
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How do I attend the annual meeting in person?
Seating at the annual meeting will be limited to Brinker’s shareholders or their proxyholders and Brinker’s
invited guests. If you are a holder of record in your own name, please bring photo identification to the annual
meeting. If you hold shares through a bank, broker or other third party, please bring photo identification and a
current brokerage statement. Cameras, recording equipment and other electronic devices will not be permitted at
the meeting. The annual meeting will begin promptly at 9:00 a.m. (CST) at our offices, so please plan to arrive
accordingly. For directions to the annual meeting, please visit the Investor Information section of our website at
http://www.brinker.com.
May I revoke my proxy?
You may change your vote or revoke your proxy any time before the annual meeting by:
• returning another proxy card with a later date;
• sending written notification of revocation to the Corporate Secretary at our principal executive offices at
6820 LBJ Freeway, Dallas, Texas 75240;
• entering a later vote by telephone or over the Internet; or
• attending the annual meeting and voting in person.
You should be aware that simply attending the annual meeting will not automatically revoke your
previously submitted proxy. If you desire to do so, you must notify an authorized Brinker representative at the
annual meeting of your desire to revoke your proxy and then you must vote in person.
Who pays for the solicitation of proxies and how are they solicited?
We pay the entire cost of the solicitation of these proxies. This cost includes preparation, assembly, printing,
and mailing of this Proxy Statement and any other information we send to you. We may supplement our efforts
to solicit your proxy in the following ways:
• we may contact you using the telephone or electronic communication;
• our directors, officers, or other regular employees may contact you personally; or
• we may hire agents for the sole purpose of contacting you regarding the proxy.
If we hire soliciting agents, we will pay them a reasonable fee for their services. We will not pay directors,
officers, or other regular employees any additional compensation for their efforts to supplement our proxy
solicitation.
Can I vote if my shares are held in “street name”?
If the shares you own are held in “street name” by a bank or brokerage firm, your bank or brokerage firm, as
the record holder of your shares, is required to vote your shares according to your instructions. In order to vote
your shares, you will need to follow the directions your bank or brokerage firm provides you. If you do not give
instructions to your bank or brokerage firm, it will still be able to vote your shares with respect to certain
“routine” items, but will not be allowed to vote your shares with respect to certain “non-routine” items. In the
case of non-routine items, the shares will be treated as “broker non-votes,” which are not counted as cast and
have no effect on the outcome of the vote. Prior to this year, election of directors was considered a routine matter
and your bank or brokerage firm was permitted to use its discretion to vote your shares on the election of
directors if you gave no instructions. We urge you to give your bank or brokerage firm instructions on all
proposals in this proxy statement. To be able to vote your shares held in street name at the meeting, you will need
to obtain a proxy from your bank or brokerage firm.
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How do I vote if my shares are held in the Company’s 401(k) Plan?
If all or some of the shares you own are held through the Company’s 401(k) Plan, you may vote via Internet
or by phone by 11:59 p.m., EST, on November 5, 2012 or the Company’s agent must receive your paper proxy
card on or before November 5, 2012.
What is “householding”?
If you and others in your household own your shares in street name, you may receive only one copy of this
proxy statement and the annual report. This practice is known as “householding.” If you hold your shares in
street name and would like additional copies of these materials, please contact your bank or broker. If you
receive multiple copies and would prefer to receive only one set of these materials, please also contact your bank
or broker. Brinker does not currently use householding for owners of record and will send notice to all owners of
record before using householding. By using this method, we give all owners of record the opportunity to continue
to receive multiple copies of these materials in the same household.
What constitutes a quorum?
In order for business to be conducted at the meeting, a quorum must be present. A quorum consists of the
holders of a majority of the shares of common stock issued, outstanding and entitled to vote at the meeting.
Shares of common stock represented in person or by proxy (including broker non-votes and shares that abstain or
do not vote with respect to one or more of the matters to be voted upon) will be counted for the purpose of
determining whether a quorum exists. If a quorum is not present, the meeting will be adjourned until a quorum is
obtained.
What vote is required to approve each proposal?
• Proposal 1: Elect Eight Directors
The eight nominees for director who receive the most votes of all nominees for director will be elected.
Votes withheld will therefore have no effect on the outcome of this proposal because only a plurality of votes
actually cast is needed to elect a director.
• Proposal 2: Ratify Selection of Independent Auditors for the 2013 Fiscal Year
The affirmative vote of a majority of the shares of common stock present or represented by proxy and
voting at the meeting is required to approve this proposal. Abstentions are counted as votes cast and have the
same effect as votes against the proposal. Broker non-votes have no effect on the outcome of the voting on this
proposal.
• Proposal 3: Advisory Vote on Executive Compensation
The approval, in an advisory, non-binding vote, of the compensation of the named executive officers of the
Company by a majority of the shares of common stock present or represented by proxy and voting at the meeting
is sought. Abstentions are counted as votes cast and have the same effect as votes against the proposal. Broker
non-votes have no effect on the outcome of the voting on this advisory, non-binding approval.
How will my proxy get voted?
If you vote over the Internet or by telephone, or properly fill in and return a paper proxy card (if requested),
the designated Proxies (Douglas H. Brooks and Bryan D. McCrory) will vote your shares as you have directed. If
you submit a paper proxy card, but do not make specific choices, the designated Proxies will vote your shares as
recommended by the Board of Directors as follows:
• “FOR” election of eight nominees for director;
• “FOR” ratification of KPMG LLP as our independent auditors for the 2013 Fiscal Year; and
• “FOR” approval in an advisory, non-binding vote of the compensation of our named executive officers.
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How will voting on “any other business” be conducted?
Although we do not know of any business to be considered at the annual meeting other than the proposals
described in this Proxy Statement, if any additional business is properly brought before the annual meeting, your
signed or electronically transmitted proxy card gives authority to the designated Proxies to vote on such matters
in their discretion.
Who will count the votes?
We have hired a third party, Broadridge Financial Solutions, to judge voting, be responsible for determining
whether or not a quorum is present and tabulate votes cast by proxy or in person at the Annual Meeting.
Where can I find voting results of the meeting?
We will announce general voting results at the meeting and publish final detailed voting results in a
Form 8-K filed within four (4) business days following the meeting.
May shareholders ask questions at the annual meeting?
Yes, our representatives will answer your questions after the conclusion of the formal business of the
meeting. In order to give a greater number of shareholders an opportunity to ask questions, we may impose
certain procedural requirements, such as limiting repetitive or follow-up questions, limiting the amount of time
for a question, or requiring questions to be submitted in writing.
How do I submit a proposal for next year’s annual meeting?
If you have a proposal, other than a nomination for the Board of Directors, that you would like us to
consider at the 2013 annual meeting of shareholders, you must submit your proposal to the Secretary of the
Company no later than May 21, 2013 and must comply with the notice, information and other provisions
contained in the Company’s bylaws. If you would like your proposal to be included in our Proxy Statement and
proxy relating to that meeting, it must also comply with the SEC rules, and you must submit it to us no later than
May 21, 2013. Proposals should be sent to our executive offices at 6820 LBJ Freeway, Dallas, Texas 75240 in
care of the Corporate Secretary.
How do I submit a nomination for the Board of Directors?
Any shareholder of the Company may recommend one or more individuals to be considered by the
Governance and Nominating Committee of the Company’s Board of Directors as a potential nominee or
nominees for election as a director of the Company. If you wish to recommend one or more individuals for a
position or positions on the Board of Directors, our bylaws require that you submit your recommendation, along
with certain information about the candidate(s) to the Secretary of the Company. If you need a copy of the
bylaws, you may obtain them free of charge from the Corporate Secretary or you may find them in the
Company’s public filings with the SEC. If you want to submit a recommendation for the Company’s 2013 annual
meeting of the shareholders, your submittal must be delivered to our principal executive offices at 6820 LBJ
Freeway, Dallas, Texas 75240 to the attention of the Corporate Secretary on or before May 21, 2013.
How can I communicate with the Board of Directors?
If you or any interested party wishes to communicate with the Board of Directors, as a group, or with an
individual director, such communication may be directed to the appropriate group or individual in care of the
General Counsel, Brinker International, Inc., 6820 LBJ Freeway, Dallas, Texas 75240. Your Board of Directors
has instructed the General Counsel to review and forward such communications to the appropriate person or
persons for response.
How can I access Brinker’s proxy materials and annual report electronically?
You can access the Company’s proxy statement, 2012 Annual Report on Form 10-K and FY 2012 Annual
Report at www.brinker.com. You may simply click on the “For Investors” tab on the home page, and then the
“Financial Information” link in the left column; the SEC filings section of our website will be available for your
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usage. We will also provide you free copies of these documents by sending a written request to the Company’s
Corporate Secretary at 6820 LBJ Freeway, Dallas, Texas 75240. If you received a Notice of Internet Availability
of Proxy Materials, you may also access this information at the website described in the Notice. We also file and
furnish our annual, quarterly and current reports and other information, including proxy statements, with the
SEC. Our SEC filings are available to the public in the SEC’s website at www.sec.gov. The FY 2012 Annual
Report and the Form 10-K accompany this proxy statement, but are not considered part of the proxy soliciting
materials.
How long may I rely upon the information in this proxy statement? May I rely upon other materials as
well regarding the annual meeting?
You should rely upon the information contained in this Proxy Statement to vote on the proposals at the
annual meeting. We have not authorized anyone to provide you with information that is different from what is
contained in this proxy statement. This proxy statement is dated September 18, 2012. You should not assume that
the information contained in this proxy statement is accurate as of any date other than such date, unless indicated
otherwise in this proxy statement, and the mailing of the proxy statement to you shall not create any implication
to the contrary. We would encourage you to check our website or the SEC’s website for any required updates that
we may make between the date of this proxy statement and date of the annual meeting.
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PROPOSAL 1
ELECTION OF DIRECTORS
Your proxy will be used to vote FOR the election of the Nominees named below unless you withhold the
authority to do so when you send in your proxy. If any Nominee becomes unavailable for election as a result of
an unexpected occurrence, we would use your shares to vote for a substitute Nominee that the Board of Directors
would propose. Each person nominated for election has agreed to serve if elected, and we have no reason to
believe that any Nominee will be unavailable to serve. All Nominees are currently serving as directors of the
Company and all were elected by the shareholders at the 2011 annual meeting of shareholders.
Information About Nominees
We are furnishing you below certain biographical information about each of the eight persons nominated as
directors. Also included is a description of the experience, qualification, attributes and skills of each nominee:
Douglas H. Brooks, 60, is Chairman of the Board of the Board of Directors, having been elected to the
position in November 2004, and has served as Chief Executive Officer of the Company since January 2004, and
as President of the Company since January 1999. Previously, Mr. Brooks served as Chili’s Grill & Bar President
from June 1994 to May 1998, Executive Vice President of the Company from May 1998 until January 1999, and
Chief Operating Officer from May 1998 until June 2003. Mr. Brooks joined the Company as an Assistant
Manager in 1978 and was promoted to General Manager later that year. He was named Area Supervisor in 1979,
Regional Director in 1982, Senior Vice President—Central Region Operations in 1987, and Senior Vice
President—Chili’s Operations in 1992. He held this position until becoming President of Chili’s in 1994.
Mr. Brooks serves on the Board of Directors of Southwest Airlines Co. He also serves on the Board of Limbs for
Life and is a member of the Professional Advisory Board for St. Jude Children’s Research Hospital. Mr. Brooks
has served on the Board of Directors since 1999. Mr. Brooks brings over thirty-four years of hands-on experience
in the casual dining industry and the Company serving in various roles from assistant manager to chief executive
officer. He provides a unique perspective to the Board with direct knowledge and understanding of the industry
as well as familiarity with the Company’s business including the ability to effectively identify and drive
execution of the Company’s strategic priorities.
Joseph M. DePinto, 49, is President and Chief Executive Officer of 7-Eleven, Inc., serving in this position
since December 2005. Previously, Mr. DePinto served as President of GameStop Corporation from March 2005
to December 2005. Prior to GameStop, he was employed by 7-Eleven, Inc. from 2002 to 2005 in various roles,
most recently Vice President, Operations from 2003 to 2005. Mr. DePinto currently serves on the Board of
Directors of 7-Eleven, Inc. and OfficeMax, Inc., and previously served on the Board of Jo-Ann Stores, Inc. He
also serves on the Boards of the Business Executives for National Security, the Retail Industry Leaders
Association, Lone Star Big Brothers/Big Sisters, the SMU Cox School of Business and the National Italian
American Foundation. Mr. DePinto has served on the Board of Directors since August 2010 and is a member of
the Compensation and Governance and Nominating Committees of the Company. Mr. DePinto brings his skills
and knowledge as chief executive of a large multi-unit retail company operating in domestic and international
markets, as well as his experience serving on the boards of other large or public companies. He provides a
significant, broad based understanding of leading a large and/or public company, as well as his specific
understanding of all aspects of retailing, including operations, marketing, finance and strategic planning.
Michael Dixon, 50, serves as Chief Financial Officer of Pinkberry, a position he has held since 2008. Prior
to joining Pinkberry, he served as Senior Vice President of Finance and Chief Financial Officer of The
Cheesecake Factory from 2003 to 2008, and Vice President and Controller from 2000 to 2003. In 2000, he was
Vice President and Controller of Petsmart.com. Prior to that, he was Director Finance and Business Development
at Walt Disney Company. Mr. Dixon has served on the Board of Directors since April 2011 and is a member of
the Audit Committee. Mr. Dixon brings extensive finance, restaurant industry experience, retail development
knowledge and experiences from prior roles with various companies, including roles as chief financial officers
and controller at a publicly-traded restaurant company.
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Harriet Edelman, 56, is Vice-Chairman of the Emigrant Bank since November 2010 and serves as a
management member of the Board of Emigrant Bank. Previously, Ms. Edelman served as Advisor to the
Chairman of Emigrant Bank from June 2008 through October 2010, and as Senior Vice President and Chief
Information Officer of Avon Products, Inc. from January 2000 through March 2008, and as Senior Vice
President, Global Supply Chain from May 1996 to January 2000, and was a member of the company’s Executive
Committee. Ms. Edelman serves on the Board of Directors of UCB Pharma and Ariba, Inc. She also serves on the
Board of Trustees of Bucknell University and is a Trustee of the New York Blood Center. Ms. Edelman has
served on the Board of Directors since March 2008 and is a member of the Audit and Governance and
Nominating Committees of the Company. Ms. Edelman brings her understanding and knowledge as a senior
officer in a worldwide retail company in areas of marketing, sales, information technology, supply chain
management and global business, experience as a senior officer in financial services, and experience serving as a
director on large company boards.
Jon L. Luther, 68, is the Chairman of the Board of Dunkin’ Brands, having recently transitioned out of the
role of Executive Chairman, a position he held from January 2009 to July 2010. Mr. Luther was Chief Executive
Officer of Dunkin’ Brands from January 2003 to December 2006, at which time he added the additional role of
Chairman. Mr. Luther served as President of Popeyes Chicken & Biscuits from January 1997 to December 2002.
Mr. Luther also served as President of CA One Services, a subsidiary of Delaware North Companies, from 1992
to 1997. Mr. Luther has served on the Board of Directors since April 2011 and is a member of the Compensation
Committee. Mr. Luther brings many years of experience in the foodservice and fast casual dining industry,
serving in various roles including chief executive officer and chairman. He also offers a broad background of
finance, franchising, governance, management and executive leadership skills.
John W. Mims, 53, is the Senior Vice President World-Wide Sales & Resort Marketing Asia for Las Vegas
Sands Corporation. Previously he was the Managing Partner of The Hunting Ridge Group, LLC, which he
founded. Previously he served as Chief Marketing and Sales Officer for Millennium & Copthorne Hotels
Worldwide from June 2008 to January 2010. Mr. Mims also served as Senior Vice President of Worldwide Sales
for Starwood Hotels and Resorts Worldwide, Inc. from November 2003 to October 2006, and as Vice President,
Sales and Marketing, Asia Pacific Division from May 2001 to November 2003. He previously worked with
PepsiCola International in their Southeast Asia operations, most recently as Director International Modern Trade
from 1999 to 2000. Mr. Mims serves on the board of Entertainment Cruises. Mr. Mims has served on the Board
of Directors since February 2007 and is a member of the Compensation and Governance and Nominating
Committees of the Company. Mr. Mims brings his understanding of international operations and marketing in
food and beverage and hospitality industries from his previous roles. He provides unique insight into aspects of
operations in countries outside of the United States. He has further experience with franchising and restaurant
management.
George R. Mrkonic, 60, is the Non Executive Chairman (Director since 1999; Chairman since 2005) of
Paperchase Products Limited, London, UK, a retailer of cards, stationary, wrap and gifts in the UK, Europe and
the Middle East. Previously he was President of Borders Group, Inc. from December 1994 until January 1997
and Vice Chairman from December 1994 until January 2002. Mr. Mrkonic currently serves as a Director for
AutoZone, Inc., Syntel, Inc., and Pacific SunWear of California, Inc., and also previously served on the Boards
of Borders Group, Inc., and Nashua Corporation. Mr. Mrkonic has served on the Brinker Board of Directors
since September 2003 and is a member of the Audit and the Compensation Committees of the Company.
Mr. Mrkonic brings his thirty plus years of experience in the retail industry as well as his knowledge and skills as
a senior executive and director of large public companies. He provides a broad understanding of the complex
strategic, governance and financial issues facing large multinational public companies in the current economic
environment.
Rosendo G. Parra, 52, is a partner and founder of Daylight Partners since November 2007. Previously,
Mr. Parra served as Senior Vice President for the Home and Small Business Group of Dell, Inc. from June 2006
to April 2007, as Senior Vice President and General Manager, Dell Americas from April 2002 until June 2006,
Senior Vice President and Co-General Manager, Worldwide Home and Small Business Group from April 2001
until April 2002, Senior Vice President, Americas Public and Americas International from September 1998 until
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April 2001, Vice President, Public and Americas International, from February 1997 until September 1998, Group
Vice President, Sales, Marketing and Service, from June 1994 until February 1997, and Vice President, Dell
USA from August 1993 until June 1994. Mr. Parra currently serves as a Director for Nii Holdings, Inc. and
PG&E Corp. Mr. Parra has served on the Board of Directors since December 2004 and is a member of the
Compensation and Governance and Nominating Committees of the Company. Mr. Parra brings his extensive
experience as a senior operating executive in technology and retail, with significant understanding of
international operations. His experience gives him a unique insight into technology and its application in the
business environment. He has further experience with turnaround, growth and distressed businesses.
YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE NOMINEES
FOR DIRECTOR.
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PROPOSAL 2
RATIFICATION OF INDEPENDENT AUDITORS
The Audit Committee of the Board of Directors selected KPMG LLP as our independent auditors for fiscal
2013. Although we are not required to submit this matter to you, the Board of Directors believes that it is good
corporate governance to do so. This proposal asks you to ratify this selection. If the appointment of KPMG LLP
is not ratified by you, the Audit Committee will reconsider the appointment. Representatives of KPMG LLP are
expected to be present at the annual meeting. They will have the opportunity to make a statement if they so desire
and they will be available to respond to appropriate questions that you may have.
Audit Fees
The following table sets forth the aggregate fees billed, or estimated to be billed, to us for the fiscal years
ended June 27, 2012 and June 29, 2011, by our independent auditors, KPMG LLP:
Fiscal Year
Annual Audit Fees(1)
Audit-Related Fees(2)
Tax Fees(3)
All Other Fees
2012
2011
$563,000
$634,000
$0
$0
$171,000
$98,000
$0
$0
(1) For fiscal 2012, annual audit fees related to professional services rendered for the audit of our annual
consolidated financial statements, reviews of our quarterly consolidated financial statements, the audits of
management’s assessment of the effectiveness of internal control over financial reporting, and the
effectiveness of internal control over financial reporting ($557,500), and the issuance of consents for
franchise circulars ($5,500).
For fiscal 2011, annual audit fees related to professional services rendered for the audit of our annual
consolidated financial statements, reviews of our quarterly consolidated financial statements, the audits of
management’s assessment of the effectiveness of internal control over financial reporting, and the
effectiveness of internal control over financial reporting ($628,500), and the issuance of consents for
franchise circulars ($5,500).
(2) For fiscal 2012 and fiscal 2011, no audit-related fees were incurred.
(3) For fiscal 2012, all tax fees were for review of income tax returns, sales tax returns and consultations
regarding federal, state, local and international tax matters.
For fiscal 2011, all tax fees were for review of income tax returns and consultations regarding federal, state,
local and international tax matters.
The Audit Committee has established policies and procedures for the approval and pre-approval of audit
services and permitted non-audit services. The Audit Committee has the responsibility to do the following:
• to engage and terminate our independent auditors;
• to pre-approve their audit services and permitted non-audit services;
• to approve all audit and non-audit fees; and
• to set guidelines for permitted non-audit services and fees.
All of the fees for fiscal 2012 and 2011 were pre-approved by the Audit Committee or were within
pre-approved guidelines for permitted non-audit services and fees established by the Audit Committee. For fiscal
year 2012, the Audit Committee set a pre-approved maximum total fee expenditure for unscheduled, on-going
audit and tax services with KPMG LLP of $200,000. In addition, if the fee for a particular item would exceed
$40,000, Audit Committee approval would be required. The Audit Committee preapproved $75,000 to deal
specifically with a 2002-2009 international tax issue which was fully settled in fiscal year 2012. The associated
fees were approximately $72,000.
YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF THE
APPOINTMENT OF KPMG LLP AS OUR INDEPENDENT AUDITORS FOR FISCAL 2013.
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PROPOSAL 3
ADVISORY VOTE ON EXECUTIVE COMPENSATION
As required by SEC rules, we are asking you to provide an advisory, non-binding vote to approve the
compensation awarded to our named executive officers, as we have described it in the “Executive
Compensation” section of this Proxy Statement, beginning on Page 21.
As described in detail in the Compensation Discussion and Analysis section, the Compensation Committee
oversees the program and compensation awarded, adopting changes to the program and awarding compensation
as appropriate to reflect the Company’s circumstances and to promote the main objectives of the Program. These
objectives include: to attract and retain top level talented leaders in a highly competitive environment; to reward
increased shareholder returns and profitable growth: and to align pay to performance.
We are asking you to indicate your support for our named executive officer compensation. We believe that
the information we have provided in this Proxy Statement demonstrates that our compensation program is
designed appropriately and works to ensure that the interests of our executive officers, including our named
executive officers, are aligned with your interest in long-term value creation.
Accordingly, we ask you approve the following resolution at the Annual Meeting:
RESOLVED, that the shareholders of Brinker International, Inc. approve the compensation awarded to the
Company’s named executive officers, as disclosed pursuant to SEC Rules, the Compensation Discussion and
Analysis, the compensation tables, notices and narrative in the Proxy Statement for the Company’s 2012 Annual
Meeting of Shareholders.
This Advisory Resolution is non-binding on the Board of Directors. Although non-binding, the Board and
Compensation Committee will review the voting results and consider your concerns in their continued evaluation
of the Company’s compensation program. Because this vote is advisory in nature, it will not affect any
compensation already paid or awarded to any named executive officer and will not be binding on or overrule any
decisions by the Board of Directors, and it will not restrict or limit the ability of the shareholders to make
proposals for inclusion in proxy materials related to executive compensation.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE
ADVISORY RESOLUTION ON EXECUTIVE COMPENSATION.
INFORMATION ABOUT THE BOARD OF DIRECTORS AND
GOVERNANCE OF THE COMPANY
Director Independence
The Board reviews the independence of each non-employee director annually to confirm that the director
continues to meet our standards as well as the requirements of the New York Stock Exchange (“NYSE”) and the
rules of the SEC. No member of the Board will be considered independent unless the Board determines that he or
she has no material relationship with the Company (either directly or as a partner, shareholder or officer of an
organization that has a relationship with the Company). The Board will not determine any director to be
independent if he or she has or has had any of the relationships set forth in the NYSE rules during the time
periods specified in such rules. The Board will describe in the proxy statement the basis for determining whether
any relationship is immaterial.
The Board of Directors has affirmatively determined each of the following directors is an “independent”
director as such term is defined and as required by our Corporate Governance Guidelines, and the requirements
of the SEC and NYSE.
Joseph M. DePinto
Michael Dixon
Harriet Edelman
Jon Luther
John Mims
George Mrkonic
Rosendo G. Parra
10
The only member of the Board who is not independent is Douglas H. Brooks. Mr. Brooks, as CEO and
President of the Company, is the only employee member of the Board. The Board has further determined that no
material relationship exists between us and each non-employee director outside of their service as a member of
the Board of Directors. In this proxy statement we may refer to these directors individually as an “Independent
Director” and collectively as the “Independent Directors.”
Board Structure
The Board of Directors does not have classes where a director serves multi-year terms. Each director serves
for a one year term and is subject to re-election by you each year. Prior to recommending a director for
nomination for re-election, the Governance and Nominating Committee considers many things including:
• the quality of past director service, and attendance at Board of Directors and Committee meetings;
• whether the director continues to possess the qualities and capabilities considered necessary or desirable
for director service;
• input from other members of the Board of Directors concerning the performance of that director through a
peer review process;
• the independence of the director; and
• whether the director has met any age guidelines for continued service.
A non-employee director is expected to serve at least four one-year terms (subject to annual renomination
and re-election). Presently, Messrs. Mims, Mrkonic and Parra have served for more than four one-year terms.
Mr. David Deno resigned from the Board of Directors on May 4, 2012, immediately following his
appointment as Chief Financial Officer of OSI Restaurant Partners, LLC.
Ms. Smith is leaving the Board of Directors at the end of her current term on November 8, 2012 after nearly
11 years of service.
Committees of the Board of Directors
The Board of Directors has the following standing committees and current committee composition:
Audit***
Committee
Board Members
Douglas H. Brooks* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cece Smith** . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Joseph M. DePinto . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Michael Dixon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Harriet Edelman . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Jon Luther . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
John Mims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
George R. Mrkonic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Rosendo Parra . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Meetings During FY’ 12 . . . . . . . . . . . . . . . . . . . . . . . . . .
Compensation
Committee
Governance &
Nominating
Committee
M
M
M
M
M
M
C
11
C
M
M
M
C
4
M
M
4
C — Committee Chair
M — Member
*
Chairman of the Board
**
Ms. Smith is leaving the Board of Directors at the end of her current term on November 8, 2012.
***
Mr. Deno served on the Audit Committee until his resignation on May 4, 2012.
11
The charters for each of these committees, as well as our Corporate Governance Guidelines, are available at
no charge to you in the Corporate Governance section of our internet website (http://www.brinker.com/investors/
Corporate_Governance.asp) or by written request directed to us, at 6820 LBJ Freeway, Dallas, Texas 75240,
Attention: Corporate Secretary.
The Board of Directors has affirmatively determined that each member of the Audit, Compensation, and
Governance and Nominating Committees meets the independence requirements applicable to those committees
required by the NYSE and the SEC.
The role of the Audit Committee is provided to you in the “Report of the Audit Committee” later in this
Proxy Statement. The Board of Directors has determined that Messrs. Dixon and Mrkonic are “audit committee
financial experts” as such term is defined in the SEC’s Regulation S-K. Further, the Board of Directors has
determined the members of the Audit Committee are “financially literate” as such term is defined by the NYSE
and the Audit Committee satisfies the “financial management expertise” standard required by the NYSE.
A discussion of the specific nature of the Compensation Committee’s responsibilities and compensation
philosophy as they relate to our executive officers is provided to you in the “Compensation Discussion and
Analysis” and “Report of the Compensation Committee” later in this Proxy Statement.
The Governance and Nominating Committee performs the following functions:
• recommends to the Board of Directors potential members to be added as new or replacement members to
the Board of Directors;
• recommends to the Board of Directors the nominees for election to the Board of Directors at the annual
shareholders meeting;
• reviews, and makes recommendation to the Board of Directors regarding, the compensation paid to
non-management Board members;
• reviews, and makes recommendation to the Board of Directors regarding, CEO succession plans;
• recommends corporate governance guidelines to the full Board of Directors;
• reviews the applicable legal standards for “independence” and the criteria applied to determine “audit
committee financial expert” status; and
• reviews the answers to annual questionnaires completed by each of the Independent Directors.
On the basis of this year’s review, the Governance and Nominating Committee delivered a report to the full
Board of Directors and the Board of Directors made its “independence” and “audit committee financial expert”
determinations.
Board Member Meeting Attendance
During the fiscal year ended June 27, 2012, the Board of Directors held five meetings. Each incumbent
director attended at least 75% of the aggregate total of meetings of the Board of Directors and Committees on
which he or she served. Also, all members of the Board of Directors attended the Company’s 2011 annual
meeting of shareholders. Such attendance allows for direct interaction between you and members of the Board of
Directors.
Chairman of the Board and Lead Director
The business and affairs of the Company are managed under the direction of the Board of Directors.
Generally, it is management’s responsibility to formalize, propose and implement strategic choices and the
Board’s role to approve strategic direction and evaluate strategic results, including both the performance of the
Company and the performance of the Chief Executive Officer. The Board believes that the combined role of
Chairman and Chief Executive Officer promotes the execution of the strategic responsibilities of Board and
12
management because the Chief Executive Officer is the director most familiar with the Company’s business and
industry and most capable of effectively identifying strategic priorities and leading the discussion and execution
of strategy.
Mr. Brooks has served as both the Chairman and Chief Executive Officer of the Company since November
2004. Because the Chairman is a member of management, the Board considers it useful and appropriate to
designate a “Lead Director” to coordinate the activities of the independent directors. The presence of a Lead
Director provides additional assurance as to the independence of the Board’s oversight of management.
Ms. Smith currently serves as Lead Director. As Lead Director, Ms. Smith chairs each meeting of the
Independent Directors (an “Executive Session”). The Independent Directors generally meet in Executive Session
at each Board meeting.
As the Lead Director of the Board, Ms. Smith’s duties include:
• presiding at all meetings of the Board of Directors when the Chairman of the Board is not present;
• serving as liaison between the Chairman of the Board and the Independent Directors;
• reviewing information sent to the Board of Directors;
• approving meeting agendas and schedules for the Board of Directors;
• having the authority to call a meeting of the Independent Directors; and
• being available for consultation and direct communication with major shareholders.
The Board believes that the combined role of Chairman and Chief Executive Officer, together with an
independent Lead Director having the responsibilities outlined above, provides the appropriate balance between
strategy development, independent leadership and oversight of senior management.
The Board’s Role in Risk Oversight
The Board has an active role, as a whole and also at the committee level, in overseeing management of the
Company’s risks, including, the Company’s enterprise risk management process that monitors and manages key
business risks facing the Company. Throughout the fiscal year, the Board regularly reviews information
regarding the Company’s strategic, financial and operational risks. The Company’s Compensation Committee
oversees the management of risks relating to the Company’s compensation policies and practices. The Audit
Committee oversees the management of risks associated with accounting, auditing, financial reporting and
internal controls over financial reporting, as well as the effectiveness of the Company’s enterprise risk
management process. The Audit Committee also assists the Board in its oversight of the integrity of the
Company’s financial statements, the Company’s compliance with legal and regulatory requirements, the
qualifications and independence of the Company’s auditors and the performance of the Company’s independent
auditors and the Company’s internal audit function. The Audit Committee is responsible for reviewing and
discussing the guidelines and policies governing the process by which senior management and the internal
auditing department assess and manage the Company’s exposure to risk, as well as the Company’s major
financial risk exposures and the steps management has taken to monitor and control such exposures. The
Governance and Nominating Committee oversees risks associated with the independence of the Board of
Directors and the Company’s governance structure. While each committee is responsible for evaluating certain
risks and overseeing the management of such risks, the entire Board of Directors is regularly informed through
updates provided at full Board meetings, attendance at committee meetings, and committee reports about such
risks.
Directors’ Compensation
The Governance and Nominating Committee annually reviews and periodically benchmarks the Board’s
compensation to assure that non-employee directors are being fairly and reasonably compensated in relation to
the restaurant industry and to comparable U.S. companies. The same proxy peer group is used for the Board as is
13
used for our named executive officers (which is identified in more detail in the Benchmarking section of the
Compensation Discussion and Analysis in this Proxy Statement). For fiscal 2013, non-employee directors of the
Company will receive the following compensation:
• an annual retainer of $50,000, which, at the director’s choosing, will be paid or granted in any
combination of cash or restricted stock units as they may elect (with the director receiving a 25% match
in restricted stock units for the portion of his or her annual compensation which they elect to take in
restricted stock units);
• an annual grant of restricted stock units, valued at approximately $85,000. Approximately 25% of the
value will be granted with a distribution date of four years from the date of grant. The remaining 75% of
the value will be granted with a distribution date of, at the director’s choice made prior to grant, (i) four
years after date of grant, (ii) the director’s departure from the Board, (iii) one year following the
director’s departure from the Board, or (iv) two years following the director’s departure from the Board;
• $6,000 total for each set of regular quarterly meetings of the Board of Directors and associated Board
Committees (“Quarterly Meetings”) attended; director attendance at these Quarterly Meetings is
expected; if a director fails to attend any portion of these meetings, the director’s total fee shall be
reduced to $2,000;
• $2,000 for each other meeting of the Board of Directors or Board Committee attended where a vote of the
Board or Committee is taken; and
• no additional fees for periodic informational updates to the Board of Directors or any Board Committee.
Providing a combination of equity and cash incents our directors to focus on long-term performance and
shareholder value while still recognizing their energy and effort throughout the year. Each director has a choice
among cash and restricted stock units for his/her annual retainer thus allowing each director to receive his/her
compensation in a manner that best fits his/her individual needs. However, the Board and we believe it is
important that each director maintain an equity stake in our company; therefore, an incentive is provided for any
portion of the annual retainer taken in equity.
Also, for fiscal 2013, commencing with Board of Director and Board Committee meetings in November
2012, Committee Chairs and our Lead Director receive a supplementary retainer for accepting the additional
responsibilities:
• Chair of the Audit Committee receives an annual retainer of $15,000;
• Chair of the Compensation Committee receives an annual retainer of $12,000;
• Chair of the Governance and Nominating Committee receives an annual retainer of $10,000; and
• Lead Director of the Board receives a retainer of $25,000.
We also reimburse directors for costs incurred by them in attending meetings of the Board. Equity grants are
made on the latest of the sixtieth day following the Board of Directors’ meeting held on the same day as the
annual shareholders meeting or the first business day of the calendar year following the annual shareholders
meeting. For Fiscal 2013, directors will receive restricted stock units for all of their equity compensation with
variable distribution dates ranging from four years after grant to two years following departure from the Board
(as described above in this Directors’ Compensation section).
14
Fiscal 2012 Director Compensation Table
Name(1)
David Deno(5)(6) . . . . . . . . .
Joseph DePinto(6) . . . . . . . .
Michael Dixon(6) . . . . . . . . .
Harriet Edelman(6) . . . . . . . .
Jon Luther(6) . . . . . . . . . . . .
John Mims(6) . . . . . . . . . . . .
George R. Mrkonic(6) . . . . .
Rosendo Parra(6) . . . . . . . . .
Cece Smith(6) . . . . . . . . . . . .
Fees Earned or Stock
Paid in Cash Awards
($)(2)
($)(3)
64,000
72,000
76,000
95,700
68,000
74,000
98,000
79,500
115,000
84,987
97,473
84,987
84,987
84,987
97,473
97,473
84,987
97,473
Option
Awards
($)
—
—
—
—
—
—
—
—
—
Change
in Pension
Value and
Nonqualified
Non-Equity
Deferred
Incentive Plan Compensation
All Other
Compensation
Earnings
Compensation
($)
($)
($)(4)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
313
442
545
111
638
79
776
125
Total
($)
148,987
169,786
161,429
181,232
153,098
172,111
195,552
165,263
212,598
(1) Mr. Brooks was omitted from the Director Compensation Table since he does not receive compensation for
serving on our Board. His compensation is reflected in the Summary Compensation Table of this Proxy
Statement.
(2) Reflects the aggregate dollar amount of all fees each director earned in Fiscal 2012 (whether paid in cash or
granted in the form of equity) for service as a director, including annual retainer, committee chair fees,
meeting fees and lead director fees. Directors had the option to receive any portion of their $50,000 annual
retainer in restricted stock units. We provide a 25% match in kind on any portion of the annual retainer
converted to units. For restricted stock units, dividends are accumulated and paid upon distribution.
(3) Ms. Edelman, Ms. Smith and Messrs. Deno, DePinto, Dixon, Luther, Mims, Mrkonic and Parra were each
granted 3,218 restricted stock units for fiscal 2012.
—Messrs. DePinto, Mims and Mrkonic, and Ms. Smith elected to receive their entire annual retainer in
stock. Ms. Edelman and Messrs. Deno, Dixon, Luther and Parra elected to receive 100% of their annual
retainer in cash.
The amounts shown represent the grant date fair value of the stock awards granted to the directors in fiscal
2012, as determined pursuant to Financial Accounting Standards Board Accounting Standards Codification
Topic 718 (“ASC Topic 718”). These amounts do not include any reduction in value for the possibility of
forfeiture.
(4) Our directors receive a complimentary dining card for use in our restaurants. The dining card value used by
each director was less than $10,000. Therefore, the values in this column are the tax gross up that was paid
to each director.
(5) Mr. David Deno resigned from the Board of Directors on May 4, 2012.
(6) The following table details the Board of Directors outstanding equity. All of our restricted shares are
non-forfeitable when granted and are not reported in the table. Mr. Brooks is omitted from this table as his
outstanding equity is reflected in the Outstanding Equity Awards Table of this Proxy Statement.
Messrs. Deno, DePinto, Dixon, Luther and Mims and Ms. Edelman are not listed on this table because all of
their equity ownership is held in restricted stock or restricted stock units and they do not hold any stock
options.
15
Directors Outstanding Equity Awards at 2012 Fiscal Year End
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable
Option
Exercise
Price
($)
Option
Expiration
Date
George R. Mrkonic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,500
6,000
6,000
30,000
—
—
—
—
25.66
23.27
22.17
21.53
01/04/2016
01/03/2015
01/12/2014
11/10/2013
Rosendo Parra . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,750
36,872
—
—
25.66
25.57
01/04/2016
02/08/2015
Cece Smith . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15,000
6,000
6,000
6,000
—
—
—
—
25.66
23.27
22.17
21.87
01/04/2016
01/03/2015
01/12/2014
01/13/2013
Name
Communications with the Board of Directors
If you or any other interested party wishes to communicate with the Board of Directors as a group or with an
individual director, including the Lead Director, you or the interested party may direct such communications to
the intended recipient in care of the General Counsel, 6820 LBJ Freeway, Dallas, Texas 75240. The
communication must be clearly addressed to the specific group or director. Your Board of Directors has
instructed the General Counsel to review and forward any such correspondence to the appropriate person or
persons for response.
Qualifications to Serve as Director
Each candidate for director must possess at least the following specific minimum qualifications:
1. Each candidate shall be prepared to represent the best interests of all the Company’s shareholders
and not just one particular constituency.
2. Each candidate shall have demonstrated integrity and ethics in his/her personal and professional life
and have established a record of professional accomplishment in his/her chosen field.
3. No candidate shall have any material personal, financial or professional interest in any present or
potential competitor of the Company.
4. Each candidate shall be prepared to participate fully in activities of the Board of Directors, including
active membership on at least one Committee of the Board of Directors and attendance at, and active
participation in, meetings of the Board of Directors and the Committee(s) of the Board of Directors of which
he or she is a member, and not have other personal or professional commitments that would, in the
Governance and Nominating Committee’s sole judgment, interfere with or limit his or her ability to do so.
5. In addition, the Governance and Nominating Committee also desires that candidates possess the
following qualities or skills:
(a) Each candidate shall contribute to the overall diversity of the Board of Directors—diversity
being broadly construed to mean a variety of opinions, perspectives, personal and professional
experiences and backgrounds, such as gender, race and ethnicity differences, as well as other
differentiating characteristics.
(b) Each candidate should contribute positively to the existing chemistry and collaborative culture
among the members of the Board of Directors.
16
(c) Each candidate should possess professional and personal experiences and expertise relevant to
the Company’s business. Relevant experiences might include, among other things, large company CEO
experience, senior level multi-unit restaurant or retail experience, and relevant senior level experience
in one or more of the following areas—finance, accounting, sales and marketing, organizational
development, information technology and public relations.
Although not an automatic disqualifying factor, the inability of a candidate to meet the independence and
other governing standards of the NYSE or the SEC will be a significant negative factor in any assessment of a
candidate’s suitability.
Internal Process of Identifying Candidates
The Governance and Nominating Committee uses a variety of means for identifying potential nominees for
director, including the use of outside search firms and recommendations from current members of the Board of
Directors and from shareholders. In determining whether to nominate a candidate, the Governance and
Nominating Committee considers the current composition and capabilities of serving board members, as well as
additional capabilities considered necessary or desirable in light of existing and future Company needs. One or
more of the members of the Governance and Nominating Committee may interview, or have an outside search
firm interview, a prospective candidate who is identified as having high potential to satisfy the expectations,
requirements, qualities and responsibilities for membership on the Board of Directors. Prospective candidates
may also be interviewed by other directors who are not members of the Governance and Nominating Committee.
Reports from those interviews or from Governance and Nominating Committee members with personal
knowledge and experience with the candidate, resumes, information provided by other contacts and other
information deemed relevant by the Governance and Nominating Committee are then considered in determining
whether a candidate shall be nominated. The Governance and Nominating Committee also exercises its
independent business judgment and discretion in evaluating the suitability of a candidate for nomination.
Nomination Rights of Shareholders
As a shareholder, you may recommend one or more candidates to be considered by the Governance and
Nominating Committee as a potential nominee or nominees for election as director of the Company at an annual
meeting of shareholders. To do so, you must comply with the notice, information and consent provisions
contained in the Company’s Bylaws (current copies of the Company’s Bylaws are available at no charge from the
Secretary of the Company and may also be found in our public filings with the SEC). In order for the candidate
recommendation to be timely for the Company’s 2013 annual meeting of shareholders, your notice to the
Secretary of the Company must be delivered to our principal executive offices no later than May 21, 2013. Any
such recommendations received by the Secretary will be presented to the Governance and Nominating
Committee for consideration. Suitable candidates (whether identified internally or by a shareholder) who, after
evaluation based upon the criteria and process described in “Internal Process of Identifying Candidates” above,
are then recommended by the Governance and Nominating Committee and, if approved by the Board of
Directors, will be included in our recommended slate of director nominees in our proxy statement.
Current Nominations
The Governance and Nominating Committee conducted an evaluation and assessment of all of the directors,
since each director’s term is only one year, for purposes of determining whether to recommend them for
nomination for re-election to the Board of Directors. After reviewing the assessment results, the Governance and
Nominating Committee determined to recommend to the Board that Messrs. Brooks, DePinto, Dixon, Luther,
Mims, Mrkonic, and Parra and Mme. Edelman be nominated for re-election to the Board of Directors. The Board
accepted the recommendations and nominated such persons. The Governance and Nominating Committee did not
receive any recommendations to shareholders proposing candidates for election to the Board at the annual
meeting.
17
Code of Ethics
We have adopted a code of ethics that applies to all members of the Board of Directors and our team
members. You may obtain a copy of the code free of charge in the Corporate Governance section of our internet
website (http://www.brinker.com/investors/Corporate_Governance.asp) or by written request directed to us, at
6820 LBJ Freeway, Dallas, Texas 75240, Attention: General Counsel.
18
EXECUTIVE OFFICERS
Ian Baines, 56, is Senior Vice President of Strategic Innovation, having been appointed to this position in
January 2011. Before rejoining the Company, Mr. Baines was with Smokey Bones Bar & Fire Grill from January
2008 until January 2011, most recently serving as President and CEO, and from January 2006 to December 2007
with Darden Restaurants, serving as Smokey Bones President and Executive Vice President of Operations.
Mr. Baines also served as Regional Vice President of Operations for Romano’s Macaroni Grill and Vice
President of Operations for Big Bowl Fresh Chinese and Thai from May 2004 to January 2006, as Chief
Operating Officer and President of Jack Astor’s Bar & Grill for Toronto-based SIR Corp Restaurants from 1993
to 2004, and as Vice President of Restaurant Operations and Vice President of Food and Beverage for Torontobased Imago Restaurants from 1986 to 1993.
Guy J. Constant, 47, is Executive Vice President and Chief Financial Officer, having been appointed to
this position in October 2010. Mr. Constant previously served as Senior Vice President of Finance from May
2008 to September 2010, and Vice President of Strategic Planning and Analysis and Investor Relations from
September 2005 to May 2008, and Senior Director of Compensation from November 2004 to September 2005.
Mr. Constant was previously employed by American Airlines for 10 years where he most recently served as
Director of Executive Compensation.
Valerie L. Davisson, 50, is Executive Vice President and Chief PeopleWorks Officer, having been elected
to this position in June 2007. Ms. Davisson previously served as Executive Vice President of People Works,
elected in June 2005, and as Senior Vice President of Human Resources since June 2004. Before joining the
Company, Ms. Davisson served as Vice President, Human Resources for Yum! Brands, Inc., Vice President,
Field Human Resources for Kentucky Fried Chicken, Senior Director, Global Staffing for Yum! Brands, Inc. and
Director, Field Human Resources for Pizza Hut.
David Parsley, 66, is Senior Vice President of Supply Chain Management, having been appointed to this
position in May 2011. Mr. Parsley previously served as the President and CEO of Centralized Supply Chain
Services, LLC from February 2009 to May 2011. Mr. Parsley was employed as Senior Vice President of Supply
Chain Management for DineEquity from November 2007 to February 2009, Senior Vice President of Supply
Chain Management for Applebees International from April 2000 to November 2007. Mr. Parsley previously held
executive positions for Prandium, Inc., the Panda Management Company and Carl Karcher Enterprises.
Mr. Parsley is a member of the Institute of Supply Chain Management and the Council of Supply Chain
Management Professionals.
Steve Provost, 52, is President of Maggiano’s Little Italy, having been appointed to this position in
November 2009, having previously served as Senior Vice President of Marketing and Brand Strategy for
Maggiano’s from April 2009 to November 2009. Mr. Provost previously served as Chief Marketing Officer and
Executive Vice President of Quizno’s Master, LLC from 2007 to 2009. Mr. Provost was employed by Yum
Brands, Inc. from 1991 to 2007, serving in various roles, most recently as Head Coach, Southeast Region for the
KFC brand from 2003 to 2005 and Chief Marketing Officer for the Long John Silver’s and A&W brands.
Wyman T. Roberts, 53, is President of Chili’s Grill & Bar, having been appointed to this position in
November 2009, having previously served as Senior Vice President, Maggiano’s Little Italy President, and Chief
Marketing Officer since March 2009, and Senior Vice President and Maggiano’s Little Italy President since
August 2005. Mr. Roberts previously served as Executive Vice President and Chief Marketing Officer for NBC’s
Universal Parks & Resorts from December 2000 until August 2005. Mr. Roberts was previously employed by
Darden Restaurants, Inc. for 16 years where he most recently served as Executive Vice President, Marketing.
Roger F. Thomson, 63, is Executive Vice President, Chief Administrative Officer, General Counsel and
Secretary, having been elected to this position in June 1996. Mr. Thomson joined the Company as Senior Vice
President, General Counsel and Secretary in 1993 and was promoted to Executive Vice President, General
Counsel and Secretary in 1994. Mr. Thomson served as a Director of the Company from 1993 until 1995.
Kelli Valade, 42, is Chief Operating Officer for Chili’s Grill & Bar, having been appointed to this position
in July 2009. Ms. Valade previously served as Senior Vice President of Chili’s Grill & Bar and On the Border
19
PeopleWorks and Brinker Shared Services from October 2008 to July 2009, and Vice President for Emerging
Brands and Corporate Human Resources from 2002 to 2008, and Director of Human Resources for On the
Border Mexican Grill & Cantina. Ms. Valade previously served as Manager of Training and Recruiting for
Carlson Restaurants Worldwide’s Specialty Concepts Division from 1994 until 1996. Ms. Valade holds a seat on
the founders board of the Multi-Cultural Food Service Hospitality Alliance and sits on the Advisory Board for
People Report.
20
EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
Throughout this discussion we make reference to terms that are used internally to define our team member
population. These team member groupings are described below:
• “named executive officers” (NEOs)—our five most highly compensated executives detailed in this
discussion;
• “Brinker Leadership Team”—this is our key leadership group of our CEO and our CEO’s direct executive
reports and other key officers (which include our executive vice presidents, our brand presidents, our head
of global development, our chief operating officer of our largest brand, our head of strategic innovation
and our head of supply chain management);
• “RSC team member”—any of our team members who work in a support role at our restaurant support
center (RSC), not specifically for one of our restaurant brands; and
• “brand team member”—any of our team members who work for a particular restaurant brand.
Structure and Role of the Compensation Committee
The Compensation Committee (“Committee”) is comprised entirely of Independent Directors who are
responsible for aligning our compensation programs with our compensation philosophy of rewarding
performance. Specifically, the Committee reviews and approves any compensation decisions regarding the
Brinker Leadership Team (with input from the CEO), including the CEO (who also is Chairman of the Board).
The CEO does not provide input on his own compensation to the Committee. Further information about the
duties of the Committee can be found in the Compensation Committee Charter, which can be found on our
website at http://brinker.com/corp_gov/comp_committee.asp. To make certain the Committee is able to
effectively carry out its responsibilities, it takes the following actions:
• Retains an independent consultant (currently Pearl Meyer & Partners) to advise on executive
compensation.
• Benchmarks, with the assistance of an outside, independent third party, data to determine competitive
compensation levels based on a peer group that represents both restaurant companies and those
companies with whom we compete for talent. The peer group for each officer may vary depending on the
nature and scope of his/her individual responsibilities.
• Approves the design and performance metrics used in our incentive plan.
• Reviews annually detailed compensation tally sheets for the named executive officers.
• Submits recommendations to the full Board of Directors for approval and ratification of the CEO’s
compensation.
• Holds executive sessions (without our management present) at every Committee meeting.
• Provides recommendations to the full Board of Directors on compensation-related proposals to be
considered at the Company’s annual meeting.
Executive Summary
Brinker’s compensation programs are structured to reinforce our strategic principles—to be a premier and
progressive company with a balanced approach towards sales, profits, guests and team members.
Fiscal 2012 saw improved results for the Company despite the weak overall economy. Our continuation and
refinement of fiscal 2011 initiatives drove much of our gains in fiscal 2012 resulting in positive comparable sales
and guest traffic at company-owned restaurants and increased earnings per share on a year-over-year basis. The
initiatives included the implementation of a team service model at Chili’s; the implementation of improved food
21
preparation procedures in the prior fiscal year; the continued retrofitting our kitchens with new technologies and
equipment; and the repurchase of shares of our common stock. The results showed in labor efficiencies, better
guest feedback, kitchen efficiencies, increased inventory control and value return to our shareholders. This
positive financial success was reflected in our variable compensation programs with short-term programs seeing
increased payout while long-term programs continue to be impacted by previous years’ underperformance.
Our compensation programs for executive officers, including our NEOs, reflect the competitive
environment in which we operate and align a pay-for-performance philosophy. More specifically we:
• Use variable compensation plans to make-up the majority of potential total compensation placing
significant amounts of compensation “at risk”;
• Establish incentive plan payout levels that provide an opportunity for participants to earn compensation
above median levels when performance goals are exceeded and our stock price increases, and
significantly reduced compensation when our financial performance is below expectations or our stock
price decreases;
• Utilize both cash and equity elements with varying time horizons and financial metrics to motivate and
reward sustained performance that is aligned with shareholder interests but is not tied to a single financial
measure or measurement period that could result in unintended consequences;
• Provide competitive levels of compensation to attract and retain the best qualified executive talent. Both
the Committee and our Brinker Leadership Team strongly believe that the caliber of our overall officer
team makes a significant difference in our sustained success over the long-term;
• Link our officers’ interests with the sustained performance of the company by having executives satisfy
stock ownership guidelines; and
• Allow actual compensation to vary based on individual performance.
Say-on-Pay Feedback from Shareholders
In 2011, we submitted our executive compensation program to an advisory vote to you, our shareholders,
and it received the support of over 99.5% of the total votes cast on the proposal. In addition, at our 2011 annual
meeting of shareholders, a majority of shareholders supported an annual vote on our executive compensation and,
in response to the Board of Directors determined to hold an annual vote on the matter. Annually, the
Compensation Committee intends to review the results of the advisory vote and will consider this feedback as it
completes its annual review of each pay element and total compensation packages for our NEOs with respect to
the next fiscal year.
Pay for Performance
The Company’s executive compensation programs are aligned with our business initiatives and have been
designed to pay commensurate with level of performance generated. This philosophy is most evident in the mix
of pay used to compensate our executives.
Our fiscal 2012 compensation packages for our CEO and NEOs are heavily weighted towards variable
compensation. The variable compensation awarded in fiscal 2012 included an annual incentive under our shortterm incentive plan, and the economic value of stock options, performance RSUs (at target), and career equity.
22
As the graphs below show, performance-based incentives constitute the largest portion of target total direct
compensation for our CEO and other NEOs:
CEO -2012 Target Pay Mix
Annual
Incentive
27%
Other NEOs -2012 Target Pay Mix
Annual
Incentive
22%
Long
Term
Equity
48%
Long
Term
Equity
42%
Salary
36%
Salary
25%
% of total variable compensation : 75%
% of total variable compensation : 64%
The Company believes the compensation programs are an important factor in driving our NEOs’
performance to achieve long term EPS growth. The success of our strategy is represented below. In years when
our performance is below target, our NEO pay programs effectively reduced pay levels. Conversely, when
performance is improved compensation increases, aligning our pay programs with shareholder returns.
Adjusted Earnings Per Share (EPS)* vs CEO Total Direct Compensaon
40.0%
30.0%
20.0%
10.0%
0.0%
-10.0%
-20.0%
-30.0%
F2008
F2009
F2010
CEO TDC growth over prior year
F2011
F2012
EPS growth over prior year
Adjusted Earnings Per Share (EPS)* vs Other NEO Total Direct Compensaon
40.0%
30.0%
20.0%
10.0%
0.0%
-10.0%
-20.0%
-30.0%
-40.0%
F2008
F2009
F2010
Other NEO TDC growth over prior year
F2011
F2012
EPS growth over prior year
* EPS calculation excludes special items and discontinued operations
23
Roles of the Compensation Committee, Consultants and Management
The Compensation Committee is responsible for determining the compensation of the Brinker Leadership
Team, including the named executive officers. All compensation recommendations are reviewed and approved
by the independent directors of the full Board. The Committee utilizes three sources during their evaluation
process: (1) Pearl Meyer & Partners (“Pearl Meyer”), the Board’s independent consulting firm; (2) Meridian
Compensation Partners, LLC (“Meridian”); and (3) management. The Committee annually reviews the
performance of all consultants.
Pearl Meyer has been retained by and reports directly to the Compensation Committee. Pearl Meyer does
not have any other consulting engagements with management. The Committee regularly asks Pearl Meyer to
provide independent advice on current trends in compensation design, including compensation levels, the merits
of particular forms of compensation, relative weighting of compensation elements and compensation best
practices.
Meridian is also retained by the Committee and provides detailed benchmarking data based on our
benchmarking peer group. Meridian does not have any other consulting engagements with management.
Meridian generates an independent report that is utilized in determining compensation levels for our Brinker
Leadership Team. A more detailed discussion of the benchmarking process is provided in the Benchmarking
section below. Based on the benchmark data and individual performance, the CEO provides input and
recommendations to the Committee in setting total compensation for the Brinker Leadership Team, excluding his
own compensation. The Committee considers these data sources, and applies its own independent judgment in
establishing a total compensation program comprised of base salary increases, if any, short-term incentive targets
as a percentage of base pay, and long-term incentive targets that aligns the interests of the executives with those
of our shareholders.
Benchmarking
The Committee engages an independent third party to provide market data regarding base salary, short-term
incentive targets, long-term incentive values, and total compensation. For fiscal 2012, we retained Meridian to
provide us with data drawn from their proprietary database. The benchmarking peer group is carefully selected
based on criteria including restaurant and brand product industries, operating structure, location and size. We
were near the median in terms of revenue size as compared to our benchmarking peer group. Proxy data from our
Performance Share Plan peer group (which is identified in more detail in the Long-Term Incentives section of
this Compensation Discussion and Analysis) was blended with data from Meridian’s database for the NEOs to
provide us with benchmark information that we believe accurately reflects the market in which we compete for
executive talent, particularly for the named executive officers. The following table lists the companies used in
fiscal 2012 as our benchmarking proxy peer group for setting the fiscal 2012 compensation for the named
executive officers:
Benchmarking Proxy Peer Group
CBRL Group, Inc.
CEC Entertainment, Inc.
The Cheesecake Factory Inc.
Darden Restaurants, Inc.
DineEquity, Inc.
Jack in the Box Inc.
McDonalds Corporation
Panera Bread Company
P.F. Chang’s China Bistro, Inc.
Red Robin Gourmet Burgers Inc.
Ruby Tuesday, Inc.
Sonic Corp.
Starbucks Corporation
Wendy’s/Arby’s Group, Inc.
Yum! Brands, Inc.
The benchmarking proxy peer group was updated for fiscal 2013 to align with the total shareholder return
peer group changes for fiscal 2012. The changes increased the number of casual dining competitors and reduced
the number of quick service companies, leaving only those quick service companies which are industry leaders or
have an equivalent market capitalization to the Company. For fiscal 2013 and forward CEC Entertainment, Inc,
Jack in the Box, Inc., Sonic Corp. and Starbucks Corporation were removed from the benchmarking proxy peer
group and BJ’s Restaurants, Inc, Buffalo Wild Wings, Inc, Chipotle Mexican Grill, Inc. and Texas Roadhouse,
Inc. were added.
24
Meridian’s benchmark information was used to establish ranges for total compensation (base salary + shortterm cash incentives + long-term equity incentives). We strive to be competitive in the marketplace by
appropriately balancing all elements of compensation (short-term versus long-term and fixed versus variable)
while recognizing our performance, as well as the individual’s performance, criticality and experience, and
internal equity. There is no fixed percentage which determines the mix between cash and non-cash compensation,
but compensation is significantly weighted towards variable compensation (short and long-term). The table
below shows the percentage of fixed versus variable compensation elements for targeted total compensation.
Targeted Fixed Versus Variable Compensation Mix for the Named Executive Officers for Fiscal 2012
Name
Position
Douglas H. Brooks . . . . . . . . . . . . . .
Guy J. Constant . . . . . . . . . . . . . . . . .
Valerie Davisson . . . . . . . . . . . . . . . .
Wyman T. Roberts . . . . . . . . . . . . . . .
Roger F. Thomson . . . . . . . . . . . . . . .
Chairman of the Board,
President and CEO
EVP and CFO
EVP, Chief PeopleWorks Officer
President of Chili’s Grill & Bar
EVP, CAO, General
Counsel and Secretary
Fixed
Compensation as a
% of Target Total
Compensation
Variable
Compensation as a
% of Target Total
Compensation
25%
75%
34%
35%
34%
39%
66%
65%
66%
61%
Fiscal 2012 Executive Compensation and Benefit Components:
For the fiscal year ended June 27, 2012, the principal components of compensation and benefits for our
named executive officers are listed:
• Base Salary;
• Short-Term Incentives;
• Long-Term Incentives;
• Retirement Benefits;
• Health and Welfare Benefits; and
• Perquisites.
In the sections that follow we detail how each component of compensation is evaluated. It is important to
note that while each individual component is reviewed; all decisions are made in a total compensation context.
Base Salary
Base salaries provide our team members with a level of certainty about their compensation. Annually, we
review base salaries during our benchmarking process. An individual’s base salary is dependent on the size and
scope of the position, their experience and most importantly their performance.
For fiscal 2012, officers, including the NEOs, received a 3% merit increase on average with the rest of the
organization.
Short-Term Incentives
Our Profit Sharing Plan is a non-qualified annual incentive arrangement in which all RSC team members,
including the named executive officers, and certain restaurant brand team members participate. The Plan
measures both financial performance and individual performance.
• At target, two-thirds of the award is based on financial performance and one-third of the award is based
on individual performance.
25
• The financial portion of the plan measures actual earnings per diluted share (EPS) versus a target EPS for
all team members. These targets are established within the first quarter of our fiscal year by the Board and
are designed to reinforce our focus on profitability and enhancement of long-term shareholder value.
• Individual performance is measured based on the achievement of key performance indicators (KPIs).
KPIs are established at the beginning of the year and align with our strategic goals. An individual
performance component allows us to recognize critical factors to our performance; and to reward an
individual’s contribution to the organization. KPIs can include such items as project implementations,
guest satisfaction, or employee engagement.
For all of our named executive officers, the financial performance portion of the short-term incentive is
based on EPS. The maximum award that any individual can receive is 150% of his/her individual short-term
incentive target, and minimum thresholds must be achieved to earn a payout. The table below details the actual
short-term incentive payout versus target for the NEOs:
Fiscal 2012 Actual Short-Term Incentive Payout versus Target
Name
Position
Douglas H. Brooks . . . . . . . . . . . . . . . . .
Chairman of the Board,
President and CEO
Guy J. Constant . . . . . . . . . . . . . . . . . . . . EVP and CFO
Valerie Davisson . . . . . . . . . . . . . . . . . . . EVP, Chief PeopleWorks Officer
Wyman T. Roberts . . . . . . . . . . . . . . . . . President of Chili’s Grill & Bar
Roger F. Thomson . . . . . . . . . . . . . . . . . . EVP, CAO, General
Counsel and Secretary
Short-Term
Incentive
Actual Payout
for Fiscal 2012
Short-Term
Incentive
Target Payout
for Fiscal 2012
$1,534,637
$1,023,091
$
$
$
$
$
$
$
$
355,587
368,681
506,236
481,465
237,058
245,787
337,491
320,977
Fiscal 2012 Profit Sharing Plan—This year the Company established a target which was consistent with our
long-term goal of annual EPS growth. Actual adjusted non-GAAP EPS for the Profit Sharing Plan was $2.05
compared to a target non-GAAP EPS for the Profit Sharing Plan of $1.95, resulting in a 150% payout under the
financial performance metric. The Brinker Leadership Team, including the NEOs, achieved full performance on
their KPIs.
The formulas used to calculate both plan and actual performance are outlined in our Profit Sharing Plan.
However, from time to time unplanned events occur that are not explicitly detailed within the Profit Sharing
Plan. In such instances, the Compensation Committee reviews the scenarios and determines how specific events
should be accounted for under the Profit Sharing Plan. The intent when making such decisions is to ensure the
impact to the Profit Sharing Plan is fair to both participants and shareholders. The Committee reviewed and
determined the treatment of the following items, among others, which impacted the earnings calculation used in
the Profit Sharing Plan: impairment charges, impact on earnings related to the closed restaurants, and
depreciation on equipment and other assets.
Long-Term Incentives
We grant a mix of stock options, performance shares, and career equity to all of our officers with the belief
that meeting our long-term strategic goals will increase our stock price. Target long-term incentive values are
determined by the Committee by analyzing benchmark data, individual performance, program cost and total
compensation targets. Once the target value is established, the number of shares granted as stock options,
performance shares and career equity is based on delivering approximately 40% of the value in stock options and
the remaining 60% in performance shares and career equity. Our equity programs give officers a stake in the
potential rewards provided to shareholders as a result of their efforts.
All equity based awards, including stock options, are granted on the last Thursday of each August.
However, the Committee will not grant equity compensation awards in anticipation of the release of material
nonpublic information so the grant date could change if such a case should occur.
26
Stock Options
Stock options are intended to motivate participants to increase our stock price as they only have value if the
market price of our stock increases over the closing price of our common stock on the date of grant. The actual
compensation realized from stock options is dependent on both the increase in our stock price and each
participant’s decision on when to exercise. Our stock options vest 25% per year over four years and have a term
of eight years.
Performance Shares
To balance out the volatility of stock options while still aligning participants with shareholder interests, we
also grant performance shares. Performance shares are earned based on our relative total shareholder return
(TSR) compared to a select group of publicly-traded restaurant companies over a three year measurement period.
The peer group is based on those companies with whom we compete for investor dollars and executive talent
(these companies are also used in our executive compensation benchmarking). TSR is the measurement of the
appreciation in the stock price for each company, plus dividends, if any. The following is a list of the fiscal 2012
TSR peer group:
Fiscal 2012-2014 Total Shareholder Return Peer Group
BJ’s Restaurants, Inc.
Buffalo Wild Wings, Inc.
CBRL Group, Inc.
Chipotle Mexican Grill, Inc.
The Cheesecake Factory, Inc.
Darden Restaurants, Inc.
DineEquity, Inc.
McDonalds Corporation
Panera Bread Company
P.F. Changs China Bistro, Inc.
Red Robin Gourmet Burgers, Inc.
Ruby Tuesday, Inc.
Texas Roadhouse, Inc.
Wendy’s/Arby’s Group, Inc.
Yum! Brands, Inc.
The target award (which is granted at the beginning of the measurement period) is adjusted by the payout
percentage which ranges from 0% to 175%. To earn 100% of a target award, we have to rank 7th in our peer
group. Any payout is reduced by 20% if our TSR is negative. A cap is also imposed on the maximum payout of
two and one half times the stock price at the time of grant. The table below reflects the ranking and related
payout percentage for the fiscal 2012-2014 performance share plan.
Rank
Payout
Percentage
1
2
3
4
5
6
7
8
9
10
11
12-16
175%
175%
165%
145%
135%
125%
100%
90%
70%
50%
20%
0%
Earned shares are distributed shortly after the completion of the three year performance period. Earned
shares are not subject to further vesting requirements; although they may need to be retained to meet stock
ownership guidelines (see discussion below).
Fiscal 2010–Fiscal 2012 Performance Share Plan—We ranked in 7th place and earned a 100% payout.
Career Equity
Career equity is a restricted stock unit program that works as a retention device since the shares only vest
upon retirement (detailed information concerning our retirement provisions can be found below in the paragraph
27
titled Retirement Definitions and Payouts). The value realized by executives is based on our stock price
performance from the grant date until the executive’s retirement, which reinforces our long-term strategic goal of
enhancing long-term shareholder value. Career equity makes up less than 10% of the total long-term incentive
value for our NEOs. The number of shares granted each year fluctuates based on our stock price. The goal is to
provide the NEOs approximately two-times their annual salary in stock at retirement (assuming their career
spanned at least fifteen years from the inception of the program).
Stock Ownership Guidelines
We have stock ownership guidelines for our Board of Directors and our senior vice presidents and above,
including the named executive officers. Stock ownership aligns these officers and directors with shareholders and
promotes good corporate citizenship. These guidelines were first adopted in fiscal 2007.
The guidelines for all senior vice presidents and above define stock ownership to include any shares
currently owned; vested, in the money stock options (which are converted for this purpose to share equivalents
based on the “in the money” value of the stock option); unvested restricted stock or restricted stock units; and
one-third of any unvested performance shares. We include one-third of the unvested performance shares, because
on average, it is expected that at least one-third of the shares will vest over multiple performance cycles. Thus, by
counting these shares towards their ownership guideline, we limit the need for them to purchase shares in the
open market to meet the guideline.
The guidelines for our Board of Directors define stock ownership to include any shares currently owned;
vested, in the money stock options (which are converted for this purpose to share equivalents based on the “in the
money” value of the stock option); and unvested restricted stock or restricted stock units. The guideline was
established by taking a multiple of base salary (annual retainer in the case of the Board) which was used to
calculate a fixed share amount by position. The guidelines are as follows:
Stock Ownership Guidelines
Stock Ownership
Guidelines
Level
Board Member . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
CEO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EVP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SVP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9,000
202,500
67,500
33,000
Ownership is reviewed annually by the Board of Directors. Officers subject to the guidelines have five years
to accumulate the necessary shares. The five year period begins on the date the officer is promoted to senior vice
president or above. If, however, such officer was not previously an employee of the company, then the officer
will be provided six years to meet the guideline. Should any of these officers be below the guideline after being
in the program for five years (or six, as applicable), they may receive half of any short-term incentives in shares
until the guideline is met. Directors have four years to accumulate the necessary shares. Currently no officer or
director is out of compliance with the guidelines. No officer or director is permitted to hedge the economic
ownership of their guideline.
Fiscal 2013 Considerations
The Compensation Committee conducted a detailed review of our compensation programs and benefits in
comparison to our operating climate and the market as a whole. The Committee determined that we had the
appropriate mix of compensation and benefits in place (cash, short-term incentives, stock options, restricted stock
units, and 401(k)). The Board did approve a merit increase pool for all team members for the fiscal year.
28
Retirement Benefits
Savings Plans
Our 401(k) Savings Plan (“401(k) Plan”) and Deferred Income Plan (“Deferred Plan”) are designed to
provide the Company’s team members with a competitive tax-deferred long-term savings vehicle. 401(k) Plan is
a qualified 401(k) plan and the Deferred Plan is a non-qualified deferred compensation plan.
• 401(k) Plan
All of our team members, including those who may be classified as highly compensated by the IRS, who
have attained the age of twenty-one and completed both one year and one thousand hours of service with the
Company are eligible to participate in the 401(k) Plan. We will match 100% of each participant’s contribution for
the first 3% of the participant’s base salary and bonus and 50% for the next 2% of the participant’s salary and
bonus. All Company contributions vest immediately.
• Deferred Plan
The Deferred Plan is a non-qualified deferred compensation plan for all of our officers, including the named
executive officers. Deferred Plan participants elect the percentage of their salary and bonus, not to exceed 50%,
they wish to defer into their Deferred Plan account. Deferrals earn a flat rate of interest which is compounded
monthly. The interest rate is based on the prime rate on the first business day each November. The interest rate
has a collar preventing it from increasing or decreasing more than one percentage point over the previous year.
We do not match executives’ deferrals under the Deferred Plan. Plan liabilities are notionally funded
through Corporate Owned Life Insurance policies held within a Rabbi Trust. Trust assets are subject to the claims
of the Company’s creditors.
Medical Benefits
Select officers, including the named executive officers, are eligible to receive retiree medical insurance from
us if they meet our definition of retirement (described below in the paragraph of the section entitled “Retirement
Definitions and Payouts”). This fully insured policy is paid for by both the retiree and the Company. The cost
split between retiree and the Company mimics that of the cost split for our active employees and their medical
benefits. Currently, that percentage is approximately 70% of the cost paid by the Company and 30% of the cost
paid by the participant. Participants are eligible to receive this coverage until age 65.
Retirement Definitions and Payouts
For those executives who remain with us for their career we want to ensure they are able to benefit from
their contributions to our long-term success. Therefore, we have defined retirement provisions that allow for
post-employment benefits. Early retirement is defined as age plus years of service equal 70, with a minimum age
of 55. Normal retirement is defined as age plus years of service equal 70, with a minimum age of 60, or age 65
(regardless of service). This definition is applied to all of our equity programs, our retiree medical program, and
our Profit Sharing Plan. Listed below are our programs and their treatment under early and normal retirement:
Early Retirement
Normal Retirement
Stock Options
Unvested shares accelerated and
remain exercisable for the shorter of
12 months or the expiration date
Unvested shares accelerated and
remain exercisable for the shorter of
36 months or the expiration date
Performance Shares
Pro-rated and paid at the end of the
measurement period based on actual
results
The full award is paid at the end of the
measurement period based on actual
results
Career Equity
Pro-rated and paid upon retirement
The full award is paid upon retirement
29
Health and Welfare Benefits
All of our salaried employees are eligible for health and welfare benefits, including the named executive
officers. Our salaried employees also receive term life insurance, short-term disability, and long-term disability.
The level of company-provided coverage for the senior vice presidents and above, including the named executive
officers, is at a higher rate than other employees for some company-provided benefits. We have provided detailed
information in the chart below for the named executive officers.
Company Paid Benefits for the Named Executive Officers
Benefit . . . . . . . . . . . . . . . . . . . . .
Life
Insurance
AD&D
Insurance
Long-Term
Disability
Long-Term
Care
4× Salary
up to $3.5M
2× Salary
up to $1M
70% Wage Replacement
up to $30K per month
$201 daily
benefit amount
Perquisites
We provide our officers with perquisites that are generally intended to promote the officers well-being and
efficiency. The Committee reviews the perquisites during our annual benchmarking process for reasonableness
and consistency with competitive practice. We currently provide our officers with the following perquisites:
• a car allowance;
• a financial planning allowance;
• a dining card;
• an annual physical reimbursement;
• an airline club membership;
• a cell phone allowance; and
• a health club reimbursement.
We do not own or lease any aircraft for the benefit of management. Providing perquisites separately, and not
rolling them into base salary, ensures those dollars are not included in our calculations for benefits such as life
insurance and other programs that use base salary in their calculation such as the Profit Sharing Plan and our
401(k) Plan.
Change in Control
We do not have any change in control agreements in place with any of our officers. However, our stock
programs and Profit Sharing Plan do contain change in control provisions. Under our stock option program, in
the event of a change in control, the unvested options are accelerated and the optionee has the full remaining term
to exercise. We have made a change to this provision that took effect in fiscal 2009 and future years where we
will only accelerate “in the money” stock options.
Vesting on all unvested restricted shares is also accelerated as of the date of change in control. Under our
Performance Share Plan, the participant becomes 100% vested and the relative ranking is established as of the
date of the change in control thus ending the measurement period. In no event will less than 100% of the target
award be distributed to the participant. This “floor” amount was included to ensure the retention of plan
participants through the change-in-control date. As for our Profit Sharing Plan, if a change in control should
occur prior to the end of the fiscal year, the participant will be eligible to receive a payment equal to the greater
of the payout as calculated under the Plan provisions or his/her annual target award. Again, the “floor” award is
included to ensure retention and to provide the participant the benefit of the doubt when the measurement period
is truncated.
Tax Implications
The Committee has considered the impact of Section 162(m) of the Internal Revenue Code. This section
disallows a tax deduction for any publicly-held corporation for individual compensation to certain executives of
30
such corporation exceeding $1,000,000 in any taxable year, unless compensation is performance-based. It is the
intent of the Company and the Committee to maximize the deductibility of our executives’ compensation
whenever possible. However, the Committee does not believe that compensation decisions should be based
solely upon the amount of compensation that is deductible for federal income tax purposes. Accordingly, the
Committee reserves the right to award compensation that is or could become non-deductible when it believes that
such compensation is consistent with our strategic goals and in our best interests. For fiscal year 2012, we believe
the annual incentive payments, stock options, and performance shares all qualify for deduction under
section 162(m).
Administration of Compensation Program
The Committee’s administration of the executive compensation program is in accordance with the principles
outlined at the beginning of this Compensation Discussion and Analysis. The Committee believes that our
compensation programs provide the necessary incentives and flexibility to promote our performance-based
compensation philosophy while being consistent with our objectives. Our financial performance supports the
compensation practices employed during the past year. No member of the Committee serves or previously served
as an employee or officer of the Company.
Recoupment Provisions
In fiscal 2009, the Committee determined that clawback language should be inserted in our individual plan
documents and our grant agreements going forward. Specifically, language was adopted stating that if the Board
of Directors determines any fraud, negligence or intentional misconduct by an Officer was a significant
contributing factor to the Company having to restate all or a portion of its financial statements, the Board or
Committee shall take, in its discretion, such action as it deems necessary to remedy the misconduct and prevent
its recurrence. Further, under Section 304 of Sarbanes-Oxley, if the Company is required to restate its financials
due to material noncompliance with any financial reporting requirements as a result of misconduct, the CEO and
CFO must reimburse the company for (1) any bonus or other incentive-based or equity-based compensation
received during the 36 months following the first public issuance of the non-complying document and (2) any
profits realized from the sale of securities of the Company during those 36 months.
Consideration of Prior Amounts Realized
In furtherance of the Company’s philosophy of rewarding executives for future superior performance, prior
stock compensation gains (or the lack thereof) are not considered in setting future compensation levels.
REPORT OF THE COMPENSATION COMMITTEE
The Compensation Committee of the Company has reviewed and discussed the Compensation Discussion
and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and
discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and
Analysis be included in this Proxy Statement.
Respectfully submitted,
COMPENSATION COMMITTEE
ROSENDO G. PARRA (Chair)
JOSEPH DEPINTO
JON LUTHER
JOHN MIMS
GEORGE R. MRKONIC
31
Compensation Policies and Practices As They Relate to the Company’s Risk Management
We believe that our compensation policies and practices for all team members, including officers, do not
create risks that are reasonably likely to have a material adverse effect on the Company. We believe that the
Company has appropriate safeguards in place with respect to the compensation programs that assist in mitigating
excessive risk-taking that could harm our value or reward poor judgment by our officers and team members.
These safeguards include: managing pay opportunities to market levels through peer benchmarking; balancing
performance focus between near-term objectives and long-term shareholder value creation; issuing equity awards
that vest over multi-year time horizons; capping cash incentive plan payments; maintaining stock ownership
guidelines for our executive officers; and no employment agreements. Furthermore, the Compensation
Committee retains its own independent compensation consultant to provide input on executive pay matters,
meets regularly, and approves all performance goals, award vehicles, and pay opportunity levels.
In fiscal 2012, the Compensation Committee reviewed the concept of risk, as it relates to our compensation
programs and determined that our programs do not encourage excessive or inappropriate risk. In reaching this
conclusion, the Compensation Committee noted that long term incentives are predominately equity based and
tied to shareholder returns, market comparisons are used, ownership guidelines are applied, and the majority of
variable pay is tied to company performance.
32
FISCAL 2012 SUMMARY COMPENSATION TABLE
Name and Principal
Position
Year
Change in
Pension
Value and
Non-Equity Nonqualified
Incentive
Deferred
Stock Option
Plan
Compensation
All Other
Salary Bonus Awards Awards Compensation
Earnings
Compensation
($)(1)
($)
($)(2)
($)(2)
($)(3)
($)(4)
($)(5)
Total
($)
Douglas H. Brooks . . . . . . . . 2012 921,704
Chairman of the Board,
2011 900,000
President, and CEO
2010 934,615
—
—
—
969,359 626,250
905,880 478,550
594,240 602,800
1,534,637
1,250,000
878,333
—
—
93,290
83,895
83,936
4,145,240
3,618,325
3,093,924
Guy J. Constant . . . . . . . . . . . 2012 395,097
EVP and CFO
2011 338,462
2010 244,038
—
—
—
306,420 167,000
203,945 101,340
82,845 76,720
355,587
244,183
94,783
—
—
—
42,446
38,735
32,955
1,266,550
926,665
531,341
Valerie Davisson . . . . . . . . . . 2012 409,646
EVP, Chief PeopleWorks 2011 396,154
Officer
2010 394,615
—
—
—
306,420 167,000
301,960 140,750
150,900 164,400
368,681
297,115
200,260
—
—
—
48,856
45,936
42,213
1,300,603
1,181,915
952,388
Wyman T. Roberts . . . . . . . . 2012 482,129
Chili’s Grill & Bar
2011 460,904
President
2010 455,865
—
—
—
384,393 167,000
392,060 225,200
164,380 191,800
506,236
403,291
270,231
—
—
—
56,169
55,805
59,507
1,595,927
1,537,260
1,141,783
Roger F. Thomson . . . . . . . . . 2012 534,961
EVP, CAO,
2011 522,364
General Counsel and
2010 542,455
Secretary
—
—
—
306,420 167,000
301,960 140,750
150,900 164,400
481,465
391,773
275,286
4,506
1,417
2,486
77,601
74,231
78,689
1,571,953
1,432,495
1,214,216
(1) The amounts shown represent all salary received during fiscal 2012. Our salaries are paid on a bi-weekly basis and due to
the 53rd week in fiscal 2010, all team members, including NEO’s, received one extra bi-weekly check in fiscal 2010.
(2) The amounts shown represent the fair market value at grant date of equity granted to the NEOs in fiscal 2012 as
determined pursuant to ASC Topic 718. These amounts do not include any reduction in the value for the possibility of
forfeiture.
(3) The amounts shown were earned under our fiscal 2012 Profit Sharing Plan. Details about the plan can be found in the
Compensation Discussion and Analysis under the section titled “Short-Term Incentives” of this Proxy Statement.
(4) Reflects the above market interest rate paid in the Deferred Plan to the NEOs. The market rate is the applicable federal
rate published under IRS Section 1274, Revenue Ruling 2012-15. The rate for June 2012 was 3.12%, for June 2011 was
4.76% and for June 2010 was 5.05%. Our Deferred Plan paid 3.75% in calendar 2012, 4.75% in calendar 2011, and
5.75% in calendar 2010.
33
(5) The amounts shown in this column reflect the value of benefits and perquisites provided to the NEOs during the year.
These include: car allowance, dining card, taxable travel, financial planning, health club reimbursement, annual physical,
phone allowance, life insurance, retiree medical, contributions to the qualified 401(k) plan and vacation buyback, which
are listed in the following table:
Name
Douglas H. Brooks . . . . . . .
Guy J. Constant . . . . . . . . . .
Valerie Davisson . . . . . . . . .
Wyman T. Roberts . . . . . . . .
Roger F. Thomson . . . . . . . .
All Other Compensation Included in the Summary Compensation Table for Fiscal 2012
Company
Company
Provided
Matching
Life, Retiree
Contributions
Medical, and
to the
Long Term
Qualified
Care
Total All
401(k)
Car
Insurance
Other
Other
Savings Plan Allowance Vacation Premiums
Compensation Compensation
($)
($)
($)
($)(a)
($)(b)
($)
10,000
10,300
10,040
10,263
10,397
12,000
9,600
9,600
9,600
9,600
—
—
—
—
—
58,855
13,753
11,962
20,963
45,337
12,435
8,793
17,254
15,343
12,267
93,290
42,446
48,856
56,169
77,601
(a) Represents benefit premiums paid to a third party for Company provided Life Insurance, Long Term Care, and
Executive Retiree Medical.
(b) Represents other compensation for value of perquisites and benefits paid directly to or on the NEOs’ behalf for
financial planning, annual executive physicals, health club membership, phone allowances and dining discounts.
34
Fiscal 2012 Grants of Plan-Based Awards Table
(a)
Name
(b)
(c)
(d)
(e)
(f)
(g)
(h)
Estimated Future Payouts
Estimated Future Payouts
Under
Under Non-Equity
Equity Incentive Plan
Incentive Plan Awards(1)
Awards(2)
Grant Threshold Target Maximum Threshold Target Maximum
Date
($)
($)
($)
(#)
(#)
(#)
Douglas H. Brooks
Performance Shares
Restricted Stock Units
Stock Options
Profit Sharing
8/25/2011
8/25/2011
8/25/2011
N/A 511,546 1,023,091 1,534,637
Guy J. Constant
Performance Shares
Restricted Stock Units
Stock Options
Profit Sharing
8/25/2011
8/25/2011
8/25/2011
N/A 118,529
Valerie Davisson
Performance Shares
Restricted Stock Units
Stock Options
Profit Sharing
8/25/2011
8/25/2011
8/25/2011
N/A 122,893
Wyman T. Roberts
Performance Shares
Restricted Stock Units
Stock Options
Profit Sharing
8/25/2011
8/25/2011
8/25/2011
N/A 168,746
Roger F. Thomson
Performance Shares
Restricted Stock Units
Stock Options
Profit Sharing
8/25/2011
8/25/2011
8/25/2011
N/A 160,488
10,898
54,490
(i)
(j)
All Other
Stock
Awards:
Number of
Shares of
Stock or
Units
(#)(3)
All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#)
(k)
(l)
Grant
Date
Fair
Exercise or Value of
Base
Stock
Price of
and
Option
Option
Awards Awards
($/Sh)
($)(4)
95,358
21.79
903,989
65,370
626,250
21.79
273,735
32,685
167,000
21.79
273,735
32,685
167,000
21.79
351,708
32,685
167,000
21.79
273,735
32,685
167,000
3,000
75,000
3,300
16,500
28,875
1,500
20,000
237,058
355,587
3,300
16,500
28,875
1,500
20,000
245,787
368,681
4,240
21,200
37,100
1,500
20,000
337,491
506,236
3,300
16,500
28,875
1,500
20,000
320,977
481,465
(1) The amounts shown in column (c) reflect the minimum payment level under the Company’s Profit Sharing Plan. The minimum award level is 50% of
target (d) and the maximum award is 150% of target (e). Threshold is represented with minimum payout of plan, but zero payout is possible if threshold
performance measures are not met.
(2) The amounts in columns (f)–(h) reflect the range of pay outs under our Performance Share Plan (detailed in the Compensation Discussion and Analysis
under the section titled “Long-Term Incentives” of this Proxy Statement). The August 25, 2011 date reflects the date the target award was established
for the performance shares. The actual award will not be earned until the end of fiscal 2014. Threshold is represented with minimum payout of plan, but
zero payout is possible if threshold performance measures are not met.
(3) The amounts listed in column (i) with a grant date of August 25, 2011 reflect the number of shares granted to the NEOs under our Career Equity
Program. The shares are granted annually based on a target value and vest upon retirement. Details of the program can be found in the Compensation
Discussion and Analysis under the section titled “Long-Term Incentives” of this Proxy Statement.
(4) The amounts shown represent the fair market value at grant date for financial reporting purposes in fiscal 2012 of stock awards as determined pursuant
to ASC Topic 718.
35
Fiscal 2012 Outstanding Equity Awards at Fiscal Year-End Table
Option Awards
Name
Stock Awards
Equity
Incentive
Equity
Plan
Incentive
Awards:
Equity
Plan
Market or
Incentive
Awards:
Payout
Plan
Number of
Value of
Awards:
Market
Unearned
Unearned
Number of
Number of
Number of
Number of Value of
Shares,
Shares,
Securities
Securities
Securities
Shares or Shares or
Units or
Units or
Underlying
Underlying
Underlying
Units of
Units of
Other
Other
Unexercised Unexercised Unexercised Option
Stock That Stock That Rights That Rights That
Options
Options
Unearned Exercise
Option
Have Not Have Not
Have Not
Have Not
(#)
(#)(1)
Options
Price Expiration
Vested
Vested
Vested
Vested
Exercisable Unexercisable
(#)
($)
Date
(#)(2)
($)(3)
(#)(4)
($)(3)
Douglas H. Brooks . . . . . . . .
21,250
55,000
82,500
110,000
112,501
82,500
187,500
187,501(5)
187,500(5)
Guy J. Constant . . . . . . . . . . .
4,000
7,000
8,250
5,000
6,001
5,250
4,500
Valerie Davisson . . . . . . . . . .
1,562
3,421
4,007
25,000
25,501
18,750
27,000
16,500
Wyman T. Roberts . . . . . . . .
10,000
17,500
15,000
18,000
21,001
18,750
15,000
Roger F. Thomson . . . . . . . . .
25,000(6)
27,001(6)
26,250(6)
69,750(6)
4,619(6)
75,000
63,750
55,000
27,500
21.79
15.83
14.79
19.12
28.30
25.65
25.78
22.59
21.67
20.45
08/25/2019
08/26/2018
08/27/2017
08/28/2016
08/30/2015
08/31/2014
10/20/2013
11/04/2014
11/13/2013
11/14/2012
3,000
6,000
6,000
5,100
5,100
91,440
182,880
182,880
155,448
155,448
54,490
90,000
75,000
1,660,855
2,743,200
2,286,000
20,000
13,500
7,000
2,750
21.79
15.83
14.79
19.12
28.30
25.65
25.78
22.75
08/25/2019
08/26/2018
08/27/2017
08/28/2016
08/30/2015
08/31/2014
10/20/2013
11/30/2014
1,500
1,500
1,500
1,500
500
45,720
45,720
45,720
45,720
15,240
16,500
20,000
9,000
502,920
609,600
274,320
20,000
18,750
15,000
7,500
21.79
15.83
14.79
19.12
28.30
25.65
25.78
22.59
23.09
08/25/2019
08/26/2018
08/27/2017
08/28/2016
08/30/2015
08/31/2014
10/20/2013
11/04/2014
06/25/2014
1,500
2,000
2,000
2,000
1,500
45,720
60,960
60,960
60,960
45,720
16,500
30,000
18,000
502,920
914,400
548,640
20,000
30,000
17,500
5,000
21.79
15.83
14.79
19.12
28.30
25.65
25.78
26.37
08/25/2019
08/26/2018
08/27/2017
08/28/2016
08/30/2015
08/31/2014
10/20/2013
08/11/2013
1,500
2,000
2,000
2,000
1,500
45,720
60,960
60,960
60,960
45,720
21,200
40,000
20,000
646,176
1,219,200
609,600
20,000
18,750
15,000
7,500
21.79
15.83
14.79
19.12
28.30
25.65
25.78
22.59
21.67
08/25/2019
08/26/2018
08/27/2017
08/28/2016
08/30/2015
08/31/2014
10/20/2013
11/04/2014
11/13/2013
1,500
2,000
2,000
2,000
1,500
45,720
60,960
60,960
60,960
45,720
16,500
30,000
18,000
502,920
914,400
548,640
36
Fiscal 2012 Outstanding Equity Awards at Fiscal Year-End Table
(Footnotes)
(1) Unvested options vest 25% per year for four years and have an eight year life.
(2) The awards listed in this column for all NEOs are for our Career Equity program (details can be found in the Compensation Discussion
and Analysis under the section entitled “Long-Term Incentives”).
(3) Restricted stock and restricted stock units are valued at the closing price of the Company’s common stock as of the end of our fiscal year
ended June 27, 2012.
(4) The grants in this column for all the NEOs reflect target awards under the F12-F14, F11-F13, and F10-F12 Performance Share Plan
respectively. The F10-F12 award paid out on 8/14/2012 at target. Mr. Brooks received the 75,000 shares listed, Mr. Constant received
the 9,000 shares listed, Ms. Davisson received the 18,000 shares listed, Mr. Roberts received the 20,000 shares listed, and Mr. Thomson
received the 18,000 shares listed.
(5) Mr. Brooks exercised these options on 8/10/2012 and 8/13/2012.
(6) Mr. Thomson exercised these options on 8/10/2012.
37
FISCAL 2012 OPTION EXERCISES AND STOCK VESTED TABLE
Option Awards
Number of Shares
Value Realized
Acquired on Exercise
on Exercise
(#)
($)(1)
Name
Douglas H. Brooks . . . . . . . . . . . . . . . . .
Guy J. Constant . . . . . . . . . . . . . . . . . . . .
Valerie Davisson . . . . . . . . . . . . . . . . . . .
Wyman T. Roberts . . . . . . . . . . . . . . . . .
Roger F. Thomson . . . . . . . . . . . . . . . . . .
187,500
—
34,760
—
43,750
Stock Awards
Number of Shares
Value Realized
Acquired on Vesting
on Vesting
(#)(2)
($)(3)
863,533
—
394,024
—
269,447
37,500
3,250
9,000
6,500
9,000
905,250
78,455
217,260
156,910
217,260
(1) Reflects the difference between the market price of our common stock at the date and time of exercise and
the exercise price of the option.
(2) Reflects the vesting of restricted stock units under the F09-F11 Performance Share Plan.
(3) The value realized is based upon the fair market value of our common stock on the date of vesting
multiplied by the number of shares/units which vested.
FISCAL 2012 NONQUALIFIED DEFERRED COMPENSATION TABLE
Name
Douglas H. Brooks . . . . . . . . . . . . . . .
Guy J. Constant . . . . . . . . . . . . . . . . . .
Valerie Davisson . . . . . . . . . . . . . . . . .
Wyman T. Roberts . . . . . . . . . . . . . . .
Roger F. Thomson . . . . . . . . . . . . . . .
Executive
Contributions in
Last Fiscal Year
($)(1)
Registrant
Contributions in
Last Fiscal Year
($)
Aggregate
Earnings in
Last Fiscal Year
($)(2)
Aggregate
Withdrawals/
Distributions
($)(3)
Aggregate
Balance at
Last Fiscal
Year-End
($)
—
—
—
—
67,781
—
—
—
—
—
—
—
—
—
16,930
—
—
—
—
—
—
—
—
—
420,915
(1) Messrs. Brooks, Constant and Roberts and Ms. Davisson do not participate in the program.
(2) Our Non-qualified Deferred Compensation program pays a fixed rate of interest on participants’ deferrals.
For deferrals in calendar year 2011, the rate paid was 4.75%. Deferrals in calendar year 2012 earned interest
at the rate of 3.75%.
(3) Reflects the amount paid to the NEO based on their distribution election.
38
FISCAL 2012 POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL FOR
DOUGLAS H. BROOKS(1)
Benefits and Payments Upon
Separation
Voluntary
Involuntary
Resignation
Not For Cause For Cause
($)
Retirement Termination Termination
Cash Compensation
Cash Severance(2) . . . .
—
—
Profit Sharing(3) . . . . . 1,534,637 1,534,637
Equity Compensation(4)
Stock Options . . . . . . . 2,761,038 2,761,038
Performance
Shares(5) . . . . . . . . . 4,668,418 4,668,418
Restricted Stock . . . . . . 745,053 745,053
Benefits & Perquisites
Deferred Savings
Plan . . . . . . . . . . . . .
Retiree Medical . . . . . .
Life Insurance(7) . . . . .
Disability
Insurance(8) . . . . . . .
Accrued Vacation . . . .
Change in
Control
Disability(6)
Death(6)
927,000
1,534,637
—
—
927,000
1,534,637
—
1,534,637
—
1,534,637
2,761,038
—
2,761,038
2,761,038
2,761,038
4,668,418
745,053
—
—
6,690,055
768,096
6,690,055
768,096
6,690,055
768,096
—
12,825
—
—
12,825
—
—
12,825
—
—
—
—
—
12,825
—
—
12,825
—
—
—
3,500,000
—
—
—
—
—
—
—
—
—
—
1,415,250
—
—
—
Total . . . . . . . . . . . . . . . . 9,721,971 9,721,971 10,648,971
—
12,693,651 13,181,901 15,253,826
(1) Mr. Brooks is eligible for retirement as of the last day of the fiscal year. It is assumed under any of the
scenarios listed (excluding death and disability) he would retire from the company.
(2) Severance payments are based on tenure. Mr. Brooks would be eligible for the maximum severance
payment of twelve months of salary.
(3) The profit sharing award shown was earned for fiscal 2012, but is unpaid as of the last day of the fiscal year
under all scenarios except for Change in Control. Our profit sharing plan states that no less than a target
award will be paid in the event of a change in control.
(4) Under our retirement provisions, Mr. Brooks is able to retain:
—All of his unvested stock options;
—A pro-rata portion of his fiscal 2012 & 2011 performance shares (33% and 67% respectively) and all of
his performance shares granted prior to fiscal 2011;
—A pro-rata portion of his career equity (97%);
For a detailed description of our retirement program, please see the Retirement Definitions and Payouts
section in the discussion portion of the proxy.
The amounts shown here do not include the value of any vested equity awards. For more information on
Mr. Brooks’ equity awards, please see the Fiscal 2012 Outstanding Equity Awards at Fiscal Year-End table.
(5) Under all of the scenarios listed except Change in Control the fiscal 2010 performance shares reflect a
payout of 100% (which was earned but unpaid as of the last day of the fiscal year) and a target payout for
fiscal 2011 and 2012 awards. Under the Change in Control scenario the fiscal 2010 award reflects a target
payout as our plan states that no less than a target award will be paid in the event of a change in control.
(6) Under our death and disability provisions Mr. Brooks would retain his unvested equity.
(7) The Company provides term life insurance for the NEOs at four times base salary with a maximum benefit
of $3,500,000.
(8) Amount listed assumes that Mr. Brooks would be on Short Term Disability for nine months (the maximum
allowed under our plan based on tenure) and then Long Term Disability for two years.
39
FISCAL 2012 POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL FOR
GUY J. CONSTANT(1)
Benefits and Payments Upon
Separation
Voluntary
Involuntary
Resignation
Not For Cause
For Cause
($)
Retirement Termination(4) Termination
Cash Compensation
Cash Severance(2) . . . . . .
Profit Sharing(3) . . . . . . . .
—
—
—
—
266,668
—
—
—
Equity Compensation(5)
Stock Options . . . . . . . . . .
Performance Shares(6) . . .
Restricted Stock . . . . . . . .
—
—
—
—
—
—
512,645
848,360
99,060
—
—
—
Benefits & Perquisites
Deferred Savings Plan . . .
Retiree Medical . . . . . . . .
Life Insurance(8) . . . . . . .
Disability Insurance(9) . . .
Accrued Vacation . . . . . . .
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Total . . . . . . . . . . . . . . . . . . .
—
—
1,726,733
—
Change in
Control Disability(7)
266,668
355,587
—
355,587
Death(7)
—
355,587
512,645 512,645 512,645
1,386,840 1,386,840 1,386,840
198,120 198,120 198,120
—
—
—
—
—
—
—
—
—
— 1,600,005
986,668
—
—
—
2,719,860 3,439,860 4,053,197
(1) Mr. Constant is not eligible for retirement as of the last day of the fiscal year.
(2) Severance payments are based on tenure. Mr. Constant would be eligible for a severance equal to eight
months of salary.
(3) The profit sharing award shown was earned for fiscal 2012, but is unpaid as of the last day of the fiscal year
under all scenarios except for Change in Control. Our profit sharing plan states that no less than a target
award will be paid in the event of a change in control.
(4) In this scenario Mr. Constant is able to retain his fiscal 2009, 2010, 2011 and 2012 option awards, a pro-rata
portion of his performance share awards, and a pro-rata portion of his career equity awards.
(5) The amounts shown here do not include the value of any vested equity awards. For more information on
Mr. Constant’s equity awards, please see the Fiscal 2012 Outstanding Equity Awards at Fiscal Year-End
table.
(6) Under all of the scenarios listed except Change in Control the fiscal 2010 performance shares reflect a
payout of 100% (which was earned but unpaid as of the last day of the fiscal year) and a target payout for
fiscal 2011 and 2012 awards. Under the Change in Control scenario the fiscal 2010 award reflects a target
payout as our plan states that no less than a target award will be paid in the event of a change in control.
(7) Under our death and disability provisions Mr. Constant would retain his unvested equity.
(8) The Company provides term life insurance for the NEOs at four times base salary with a maximum benefit
of $3,500,000.
(9) Amount listed assumes that Mr. Constant would be on Short Term Disability for eight months (the coverage
allowed under our plan based on tenure) and then Long Term Disability for two years.
40
FISCAL 2012 POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL FOR
VALERIE DAVISSON(1)
Benefits and Payments Upon
Separation
Voluntary
Involuntary
Resignation
Not For Cause For Cause Change in
($)
Retirement Termination(4) Termination Control Disability(7)
Cash Compensation
Cash Severance(2) . . . . . . .
Profit Sharing(3) . . . . . . . . .
—
—
—
—
274,667
—
—
—
Equity Compensation(5)
Stock Options . . . . . . . . . . .
Performance Shares(6) . . . .
Restricted Stock . . . . . . . . .
—
—
—
—
—
—
769,038
1,325,880
137,160
—
—
—
Benefits & Perquisites
Deferred Savings Plan . . . .
Retiree Medical . . . . . . . . . .
Life Insurance(8) . . . . . . . .
Disability Insurance(9) . . . .
Accrued Vacation . . . . . . . .
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Total . . . . . . . . . . . . . . . . . . . .
—
—
2,506,745
—
274,667
368,681
—
368,681
Death(7)
—
368,681
769,038 769,038 769,038
1,965,960 1,965,960 1,965,960
274,320 274,320 274,320
—
—
—
—
—
—
—
—
—
— 1,648,000
994,667
—
—
—
3,652,666 4,372,666 5,025,999
(1) Ms. Davisson is not eligible for retirement as of the last day of the fiscal year.
(2) Severance payments are based on tenure. Ms. Davisson would be eligible for the maximum severance
payment of eight months of salary.
(3) The profit sharing award shown was earned for fiscal 2012, but is unpaid as of the last day of the fiscal year
under all scenarios except for Change in Control. Our profit sharing plan states that no less than a target
award will be paid in the event of a change in control.
(4) In this scenario Ms. Davisson is able to retain her fiscal 2009, 2010, 2011 and 2012 option awards, a
pro-rata portion of her performance share awards and a pro-rata portion of her career equity awards.
(5) The amounts shown here do not include the value of any vested equity awards. For more information on Ms.
Davisson’s equity awards, please see the Fiscal 2012 Outstanding Equity Awards at Fiscal Year-End table.
(6) Under all of the scenarios listed except Change in Control the fiscal 2010 performance shares reflect a
payout of 100% (which was earned but unpaid as of the last day of the fiscal year) and a target payout for
fiscal 2011 and 2012 awards. Under the Change in Control scenario the fiscal 2010 award reflects a target
payout as our plan states that no less than a target award will be paid in the event of a change in control.
(7) Under our death and disability provisions Ms. Davisson would retain her unvested equity.
(8) The Company provides term life insurance for the NEOs at four times base salary with a maximum benefit
of $3,500,000.
(9) Amount listed assumes that Ms. Davisson would be on Short Term Disability for eight months (the coverage
allowed under our plan based on tenure) and then Long Term Disability for two years.
41
FISCAL 2012 POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL FOR
WYMAN T. ROBERTS(1)
Benefits and Payments Upon
Separation
Voluntary
Involuntary
Resignation
Not For Cause
For Cause
($)
Retirement Termination(4) Termination
Change in
Control Disability(7)
Death(7)
Cash Compensation
Cash Severance(2) . . . . . .
Profit Sharing(3) . . . . . . . .
—
—
—
—
283,894
—
—
—
Equity Compensation(5)
Stock Options . . . . . . . . . .
Performance Shares(6) . . .
Restricted Stock . . . . . . . .
—
—
—
—
—
—
944,675
1,637,792
137,160
—
—
—
944,675 944,675 944,675
2,474,976 2,474,976 2,474,976
274,320 274,320 274,320
Benefits & Perquisites
Deferred Savings Plan . . .
Retiree Medical . . . . . . . .
Life Insurance(8) . . . . . . .
Disability Insurance(9) . . .
Accrued Vacation . . . . . . .
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
— 1,946,700
— 1,003,894
—
—
—
—
Total . . . . . . . . . . . . . . . . . . .
—
—
3,003,521
—
4,484,101 5,204,101 6,146,907
283,894
506,236
—
506,236
—
506,236
(1) Mr. Roberts is not eligible for retirement as of the last day of the fiscal year.
(2) Severance payments are based on tenure. Mr. Roberts would be eligible for severance equal to seven months
of salary.
(3) The profit sharing award shown was earned for fiscal 2012, but is unpaid as of the last day of the fiscal year
under all scenarios except for Change in Control. Our profit sharing plan states that no less than a target
award will be paid in the event of a change in control.
(4) In this scenario Mr. Roberts is able to retain his fiscal 2009, 2010, 2011 and 2012 option awards, a pro-rata
portion of his performance share awards, and a pro-rata portion of his career equity awards.
(5) The amounts shown here do not include the value of any vested equity awards. For more information on
Mr. Roberts’ equity awards, please see the Fiscal 2012 Outstanding Equity Awards at Fiscal Year-End table.
(6) Under all of the scenarios listed except Change in Control the fiscal 2010 performance shares reflect a
payout of 100% (which was earned but unpaid as of the last day of the fiscal year) and a target payout for
fiscal 2011 and 2012 awards. Under the Change in Control scenario the fiscal 2010 award reflects a target
payout as our plan states that no less than a target award will be paid in the event of a change in control.
(7) Under our death and disability provisions Mr. Roberts would retain his unvested equity.
(8) The Company provides term life insurance for the NEOs at four times base salary with a maximum benefit
of $3,500,000.
(9) Amount listed assumes that Mr. Roberts would be on Short Term Disability for seven months (the coverage
allowed under our plan based on tenure) and then Long Term Disability for two years.
42
FISCAL 2012 POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL FOR
ROGER F. THOMSON(1)
Benefits and Payments Upon
Separation
Cash Compensation
Cash Severance(2) . . . . . .
Profit Sharing(3) . . . . . . . .
Voluntary
Involuntary
Resignation
Not For Cause For Cause
($)
Retirement Termination Termination
538,035
481,465
—
—
Equity Compensation(4)
Stock Options . . . . . . . . . . 769,038 769,038
Performance Shares(5) . . . 1,965,960 1,965,960
Restricted Stock . . . . . . . . 274,320 274,320
769,038
1,965,960
274,320
—
—
—
769,038 769,038 769,038
1,965,960 1,965,960 1,965,960
274,320 274,320 274,320
—
4,518
—
—
—
—
4,518
—
—
—
—
—
—
—
—
—
—
—
4,518
4,518
—
—
— 2,152,140
— 1,123,526
—
—
—
—
Total . . . . . . . . . . . . . . . . . . . 3,495,301 3,495,301
4,033,336
—
4,033,336 4,618,827 5,642,923
—
4,518
—
—
—
538,035
481,465
—
481,465
Death(6)
—
481,465
Benefits & Perquisites
Deferred Savings Plan . . .
Retiree Medical . . . . . . . . .
Life Insurance(7) . . . . . . .
Disability Insurance(8) . . .
Accrued Vacation . . . . . . .
—
481,465
Change in
Control Disability(6)
—
481,465
(1) Mr. Thomson is eligible for retirement as of the last day of the fiscal year. It is assumed under any of the
scenarios listed (excluding death and disability) he would retire from the company.
(2) Severance payments are based on tenure. Mr. Thomson would be eligible for the maximum severance
payment of twelve months of salary.
(3) The profit sharing award shown was earned for fiscal 2012, but is unpaid as of the last day of the fiscal year
under all scenarios except for Change in Control. Our profit sharing plan states that no less than a target
award will be paid in the event of a change in control.
(4) Under our retirement provisions, Mr. Thomson is able to retain:
—All of his unvested stock options;
—All of his performance shares; and
—All of his career equity.
The amounts shown here do not include the value of any vested equity awards. For more information on
Mr. Thomson’s equity awards, please see the Fiscal 2012 Outstanding Equity Awards at Fiscal Year-End
table.
(5) Under all of the scenarios listed except Change in Control the fiscal 2010 performance shares reflect a
payout of 100% (which was earned but unpaid as of the last day of the fiscal year) and a target payout for
fiscal 2011 and 2012 awards. Under the Change in Control scenario the fiscal 2010 award reflects a target
payout as our plan states that no less than a target award will be paid in the event of a change in control.
(6) Under our death and disability provisions Mr. Thomson would retain his unvested equity.
(7) The Company provides term life insurance for the NEOs at four times base salary with a maximum benefit
of $3,500,000.
(8) Amount listed assumes that Mr. Thomson would be on Short Term Disability for nine months (the
maximum allowed under our plan based on tenure) and then Long Term Disability for two years.
43
REPORT OF THE AUDIT COMMITTEE
In accordance with its written charter adopted by the Board of Directors, the Audit Committee assists the
Board of Directors in fulfilling its responsibility for oversight of the quality and integrity of our accounting,
auditing and financial reporting practices. Our management is responsible for our internal controls and the
financial reporting process. KPMG LLP, our independent auditors, is responsible for performing an independent
audit of our financial statements in accordance with the standards of the Public Company Accounting Oversight
Board (United States) and for issuing a report on those statements. The Audit Committee’s responsibility is to
monitor and oversee these processes. The Audit Committee also is responsible for the selection of our
independent auditors. The Audit Committee is composed solely of independent directors who are qualified for
service under NYSE listing standards and SEC rules.
In this context, the Audit Committee held discussions with our management regarding our audited financial
statements. Our management represented to the Audit Committee that our audited financial statements were
prepared in accordance with generally accepted accounting principles. Such discussions also involved an
evaluation of the independence of KPMG LLP. The Audit Committee reviewed and discussed the audited
financial statements with both management and KPMG LLP. The Audit Committee also discussed with
KPMG LLP the matters required to be discussed by Statement on Auditing Standards No. 61 (Communication
with Audit Committees). The Audit Committee received the written disclosures and the letter from KPMG LLP
required by Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees)
and discussed with KPMG LLP their independence in connection with their audit of our financial statements.
Based on the discussions with KPMG LLP concerning the audit, the independence discussions, and the
financial statement review, and such other matters deemed relevant and appropriate by the Audit Committee, the
Audit Committee recommends to the Board that the financial statements be included in our Annual Report on
Form 10-K for the fiscal year ended June 27, 2012 for filing with the SEC. The Audit Committee approved the
appointment of KPMG LLP as our independent registered public accounting firm for the 2012 fiscal year.
Further, in accordance with its written charter, the Audit Committee is responsible for discussions with
management relating to the Company’s processes to monitor and minimize significant risks and exposures.
During Fiscal 2012, the Audit Committee reviewed and discussed with management progress on the Company’s
enterprise risk management processes including the evaluation of identified risks and alignment of Company
processes to manage the risks within the Company’s approved strategies.
Respectfully submitted,
AUDIT COMMITTEE
GEORGE R. MRKONIC (Chair)
MICHAEL DIXON
HARRIET EDELMAN
CECE SMITH
44
STOCK OWNERSHIP OF CERTAIN PERSONS
The following table shows the beneficial ownership of our common stock as of August 13, 2012 by (a) all
persons known by us to beneficially own more than 5% of our common stock as of such date, (b) each present
director, including present directors being considered for election at the annual meeting, (c) the named executive
officers, and (d) all executive officers and directors as a group.
Number of
Shares of
Common Stock
Beneficially Owned
as of
August 13, 2012
Name
FMR LLC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
82 Devonshire Street
Boston, MA 02109
The Vanguard Group, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
100 Vanguard Blvd.
Malvern, PA 19355
BlackRock, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
40 East 52nd Street
New York, NY 10222
Directors(5)
Douglas H. Brooks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Joseph M. DePinto . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Michael Dixon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Harriet Edelman . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Jon Luther . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
John W. Mims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
George R. Mrkonic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Rosendo G. Parra . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cece Smith . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Named Executive Officers(5)(8)
Guy J. Constant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Valerie Davisson . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Wyman T. Roberts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Roger F. Thomson . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
All Executive Officers and Directors as a Group
(17 persons) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Number
Attributable to
Options Exercisable
Within 60 Days of
August 13, 2012
Percent(10)
12,181,783(1)
(4)
16.48%
5,358,251(2)
(4)
7.25%
4,096,798(3)
(4)
5.54%
1,083,748(6)
19,893(6)
6,868(6)
32,071(6)
6,868(6)
55,118(6)
88,541(6)
94,361(6)
105,093(6)
746,251(7)
—(7)
—(7)
—(7)
—(7)
—(7)
49,500(7)
40,622(7)
33,000(7)
1.47%
*
*
*
*
*
*
*
*
65,073(6)
184,170(6)
173,087(6)
113,246(6)
56,251(9)
147,991(9)
144,001(9)
26,250(9)
*
*
*
*
2,135,186(6)
1,341,338(9)
2.89%
*
Less than 1%.
(1)
Based on information contained in Schedule 13G/A dated February 13, 2012, filed on February 14, 2012.
The Schedule 13G/A reported that FMR LLC owned and had sole dispositive power over 12,181,783
shares of common stock, and had sole voting power over 468 shares.
(2)
Based on information contained in Schedule 13G dated February 6, 2012, filed on February 9, 2012. The
Schedule 13G reported that The Vanguard Group, Inc. owned and had sole dispositive power over
5,301,248 shares of common stock and sole voting power over 57,003 shares of common stock.
(3)
Based on information contained in Schedule 13G/A dated January 20, 2012, filed on February 13, 2012.
The Schedule 13G/A reported that BlackRock, Inc. owned and had sole dispositive power and sole voting
power over 4,096,798 shares of common stock.
(4)
Not Applicable.
(5)
We determined beneficial ownership in accordance with the rules of the SEC. Except as noted, and except
for any community property interests owned by spouses, the listed individuals have sole investment power
and sole voting power as to all shares of stock of which they are identified as being the beneficial owners.
45
(6)
Our list includes shares of common stock which may be acquired by exercise of options vested, or vesting
within 60 days of August 13, 2012, under one of the following plans: i) Stock Option and Incentive Plan,
and ii) 1999 Stock Option and Incentive Plan for Non-Employee Directors and Consultants, as applicable.
(7)
Mr. Brooks owns 872,501 stock options, 746,251 of which have vested, or will vest, within 60 days of
August 13, 2012. Mr. Mrkonic owns 49,500 stock options, all of which have previously vested. Mr. Parra
owns 40,622 stock options, all of which have previously vested. Ms. Smith owns 33,000 stock options, all
of which have previously vested. Messrs. DePinto, Dixon, Luther and Mims, and Ms. Edelman own no
stock options.
(8)
In addition to Mr. Brooks who serves as a director.
(9)
Mr. Constant owns 83,751 stock options, 56,251 of which have vested, or will vest, within 60 days of
August 13, 2012. Ms. Davisson owns 182,991 stock options, 147,991 of which have vested, or will vest,
within 60 days of August 13, 2012. Mr. Roberts owns 187,751 stock options, 144,001 of which have
vested, or will vest, within 60 days of August 13, 2012. Mr. Thomson owns 61,250 stock options, 26,250
of which have vested, or will vest, within 60 days of August 13, 2012. All Executive Officers and
Directors as a Group own 1,690,088 stock options, 1,341,338 of which have vested, or will vest, within
60 days of August 13, 2012.
(10) This percentage is based on number of outstanding shares of common stock as of August 13, 2012
(73,925,390 shares).
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under the securities laws of the United States, our directors and executive officers, and persons who own
more than 10% of our common stock are required to report their initial ownership of our common stock and any
subsequent changes in that ownership to the SEC and to furnish us with copies of all such reports. Based on our
review of the reports we received and other written communications, we believe that all filing requirements were
satisfied during fiscal 2012, with the exception of a Form 5 filing filed on July 11, 2012, reporting the sale of
stock on November 7, 2011 on behalf of Steve Provost.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
It is our policy, where possible, to avoid transactions (except those which are employment related) with
officers, directors, and affiliates. If we believe we should enter into any such transactions, we will do so on terms
no less favorable to us than we could obtain from third parties, and such transactions will be approved by a
majority of the disinterested directors of the Company. Except as noted below, there were no transactions
required to be reported.
During fiscal 2012, we employed three family members of one of our executive officers as full-time team
members. Additionally we employed three family members of two of our executive officers as part-time team
members in our restaurants. Each of these family members received compensation comparable to other team
members in the Company at a similar level, are not executive officers or directors, and do not report directly to
any of our executive officers or directors. None of our directors or executive officers has a material interest in
these family members’ employment relationship. The three full-time family members, and three part-time family
members do not share a home with their executive officer or director.
MISCELLANEOUS
The Annual Report to Shareholders of the Company, including our Form 10-K for the fiscal year ended
June 27, 2012, accompanying this Proxy Statement is not deemed to be a part of the Proxy Statement.
By Order of the Board of Directors,
ROGER F. THOMSON
Secretary
Dallas, Texas
September 18, 2012
46